Manulife IM's fund hits $600m in GP-Led secondaries

Manulife IM closes its Strategic Secondaries Fund, focusing on innovative investments in top sectors

Manulife IM's fund hits $600m in GP-Led secondaries

Manulife Investment Management (Manulife IM) has announced the final closing of the Manulife Strategic Secondaries Fund L.P. (the fund) today, marking a significant milestone as its GP-led secondary program surpasses $600m.

The fund, dedicated to investments in sector-leading companies supported by high-quality general partners (GPs), has amassed $610m in total capital commitments.

This financial backing comes from a broad array of third-party investors and the Manulife general account, highlighting the platform's diverse investment appeal.

Jeff Hammer and Paul Sanabria, serving as global co-heads and co-portfolio managers, spearhead the fund's strategy. They have played a pivotal role in recognizing and capitalizing on the expanding scope of the secondary market, particularly the surge in GP-led secondaries.

Paul Sanabria highlighted the critical role of GP-led secondaries in the market, noting their consistent account for about 50 percent of the global secondary transaction volume over the last four years.

He emphasized the mutual benefits for limited partners and sponsors, citing the opportunity for sponsors to retain prized assets for further value creation and for partners to achieve interim liquidity.

The fund's investment strategy is to primarily focus on continuation vehicles, preferring transactions involving three or fewer assets. This approach is aimed at generating secondary market alpha by selectively compiling a portfolio of outstanding companies, each carefully underwritten.

A key strategy is the fund's investment alongside reputable sponsors, ensuring a strong alignment with new investors.

Jeff Hammer elaborated on the transformative impact of continuation vehicles on the secondary market, emphasizing the meticulous due diligence and precision in underwriting returns. This method, he explained, allows for the realization of superior secondary market returns for investors.

Manulife IM's approach to the secondary market is supported by its sponsor-centric platform, which includes over 200 general partner relationships.

This network provides capital solutions across five key verticals: primary fund investments, equity co-investments, senior and junior credit, and GP-led secondaries. As of December 31, 2023, Manulife IM manages $25.8bn in assets under management (AUM) within private equity and credit sectors.

Vipon Ghai, global head of private equity and credit at Manulife IM, expressed gratitude towards their global private equity sponsors for their trust and recognition of Manulife's expertise in offering flexible capital solutions.

Ghai praised the inaugural fund focused on GP-led secondaries for its successful navigation of a challenging macroeconomic landscape, providing a unique investment avenue for clients.