Religare, an Indian financial services company, has agreed to pay up to $171.5 million to buy a 55 percent stake in fund of funds and secondaries firm Landmark Partners.
Landmark’s management team has made “long-term commitments” to the business and will continue to run daily operations and be responsible for all investment decisions, Religare and Landmark said in a statement. The firm’s managers will retain a substantial equity stake in the business, according to the statement.
The private equity and real estate investment firm is currently raising its latest real estate vehicle, Landmark Real Estate Fund VI, targeting $750 million. The firm is believed to have held a first close. Earlier this year, Landmark closed its 14th private equity secondaries fund, reportedly on about $1.9 billion.
The Landmark deal marks the second major private equity purchase Religare has made since commencing its plan to spend $1 billion on investments in asset management businesses. The target amount includes firms outside of private equity.
Earlier this year, Religare bought a majority stake in fund of funds firm, Northgate Capital. Under that deal, Northgate’s five partners retained a controlling interest in the fund of fund’s general partner entities and a significant stake in the fund management company.
At the time, Religare and Northgate said the fund of funds would see no changes to its management team, investment staff, investment committee and investment strategy.
In June, Landmark partner Chad Alfeld told PERE the market for secondaries was similiar to a “rising tide of deal activity”, rather than a tidal wave of investors looking for liquidity. During 2009, he said, only $1.2 billion of secondary transactions were completed.
Landmark currently manages 27 private equity and real estate secondary funds-of-funds with more than $8.3 billion of committed capital, the statement added.
Jeffries and Religare Capital Markets Limited were the financial advisors to Religare, while law firms Paul, Weiss acted as transaction counsel to Religare, with Ropes & Gray acting as counsel for Landmark.