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Petershill Partners plans IPO

Petershill Partners plans IPO – yesterday Petershill Partners published an intention to float announcement and quickly followed that up with the publication of a registration document.

The intention to float statement says that Petershill Partners is a global GP (general partner) solutions investment group. It provides growth capital to, and partners with, a diverse group of well-established, high quality, independent alternative asset managers. It buys direct minority equity stakes in these businesses and seeks to accelerate their development.

Currently, it holds minority investments in 19 firms which were previously held in private funds managed by Goldman Sachs Asset Management (GSAM). The firms have $187bn of aggregated assets under management.

Strong organic growth in assets under management (AUM) is complemented by a diversified revenue stream comprised substantially of contractually committed, high and stable management fees on long-dated assets.

The company delivered an organic 21% compound annual growth in aggregate AUM over 2018-2020. The announcement says that it has attractive operating leverage and a significant opportunity to grow through further acquisitions. Aggregate distributable earnings for the underlying firms more than doubled from $108m in 2018 to $243m in 2020, and reached $310m for the 12-month period ending 30 June 2021.

Petershill Partners will be a standalone company operated by a Goldman Sachs Asset Management team that was founded in 2007, and that made and has managed the initial 19 investments in the portfolio. It will be governed by an independent board.

IPO

The ordinary shares would be admitted to the premium listing segment of the Official List of the FCA and to trading on the Main Market of the LSE.

The offer would comprise (i) the issue of new ordinary shares, targeting gross offer proceeds of $750m to fund ongoing expenses and acquire further stakes in alternative asset managers and (ii) the sale of existing ordinary shares in order to achieve a free float of 25%.

[So far, so understandable – however the Registration Document is a barely comprehensible jumble of risk warnings and legalese that doesn’t really start to tell you what Petershill Partners is and what it is trying to achieve until page 53. In our view, it is one of the worst examples of these types of documents that we have seen. However, there is a lot of interesting background information on the alternative asset management industry from page 38 onwards.

As always, if you are thinking of buying shares in this company, make sure that you understand what you are buying and the risks involved. Remember that the offer is subject to geographical restrictions. We are playing no part in the IPO and are not making any recommendation one way or the other.]

The registration document and other information on the company are available here

Here is the current portfolio

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