Investcorp signs US$1bn deal with HarbourVest for its MENA private equity portfolio

AFRICA – Investcorp, a global manager of alternative investment products, secured funds from HarbourVest to provide liquidity for its US$866m Middle East and North Africa (MENA) private equity investment portfolio.

The structured secondaries transaction also includes an additional US$70m of new capital for follow-ons and up to US$60m for new investments. As part of the deal, Investcorp will continue to manage the portfolio and will retain an interest.

Hazem Ben-Gacem, Investcorp’s co-chief executive officer, said in a statement: “This milestone deal is a testament to the attractiveness of Investcorp’s MENA portfolio to global institutional investors.

“Our experience through secondary market transactions and the creation of a buyout fund in Europe gives us credibility and confidence to be the pioneers of this investment strategy in the region.”

The new transaction is subject to the relevant regulatory approvals and other customary closing conditions.

Investcorp will maintain an interest in the portfolio and Investcorp’s Mena private equity team will continue to manage the portfolio, the company said.

“We are pleased to continue the strong partnership we have developed with Investcorp,” David Atterbury, managing director of HarbourVest Partners, said.

“This complex secondary transaction highlights our ability to work with partners to create innovative liquidity solutions that can benefit multiple parties.”

In January 2019, Investcorp signed two similar deals for its European private equity assets. One was the sale of two portfolio companies in Investcorp’s Technology Partners Fund to a continuation vehicle supported by HarbourVest.

The other was a secondary private equity transaction that included the sale of some of its European private equity portfolio to Coller Capital and the creation of a new buyout fund.

Since its establishment in 1982, Investcorp has completed over 185 private equity deals in the US, Europe, the Mena region and Asia, across a range of sectors including retail and consumer products, technology, business services and industrials.

The firm more than tripled the level of inflows into its private equity arm in the 12 months to 30 June, with placements and fundraising reaching US$1.9bn.

The increase in fundraising was partially driven by two similar deals signed in January for its European private equity assets.

The firm employs 427 people across its offices in Bahrain, New York, London, Abu Dhabi, Riyadh, Doha, Singapore, and Mumbai.

As at June 30, the asset manager had US$28.2bn in total assets under management, up 7% year-on-year, edging closer to its 2022 target of US$50bn, it said.

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