Potential benefits of secondaries
A key potential benefit of a private equity strategy focused on secondaries is its potential to provide an enhanced liquidity profile compared to a primary-focused strategy. Because secondary investors enter after the investment period is complete, the underlying portfolio is much closer to the point of realization. This typically allows investors to mitigate the J-curve and shorten the duration of their investment.
Pomona enhanced liquidity
Pomona typically purchases seasoned funds well into their 10-year life cycle whose commitments are 70–90% called. Pomona manages the Pomona Investment Fund (PIF) portfolio to receive cash distributions as the more mature assets are realized, while also adding younger assets to the portfolio that are expected to enter the growth phase. This maturity profile has led to an enhanced liquidity profile and, in our view, puts PIF in a strong position to comfortably meet its outstanding commitments and to nimbly respond to new investment opportunities.
27% Average annual portfolio liquidity1 (as % of NAV)
8% Average annual distribution2,3 to shareholders (as % of NAV)
Notable liquidity events
Below is a list of articles that discuss companies that were recently liquidated from the fund. Please refer to the recent headlines and corresponding links below for more information on these liquidity events.
Accel-KKR Closes $1.9 Billion Continuation Fund to Support Further Growth of isolved
Accel-KKR, a global technology-focused investment firm, announced the completion of AKKR Isosceles CV LP, an approximately $1.9 billion single-asset continuation fund that will extend its partnership with isolved, a provider of human capital management (HCM).
Software and solutions servicing the entire employee lifecycle. The transaction allows Accel-KKR to provide liquidity to existing investors in isolved while providing the company with a commitment of $350 million in new capital to accelerate its growth through organic initiatives and accretive acquisitions.
Secondaries at Goldman Sachs Alternatives served as the lead investor in AKKR Isosceles CV LP, with participation from various other institutional investors. AKKR Strategic Capital LP, the $2.2 billion software secondaries fund Accel-KKR closed in 2024, also invested in AKKR Isosceles CV LP. Post-transaction, the employees of Accel-KKR comprise, as a group, the single largest investor in AKKR Isosceles CV LP.
Accel-KKR originally invested in isolved in 2011. In 2019, when Accel-KKR Capital Partners III, LP, the $600 million 2008 vintage technology buyout fund in which isolved was held, approached the end of its term, Accel-KKR formed Accel-KKR Capital Partners CV III, L.P. (“CV III Fund”), an approximately $1.4 billion multi-asset continuation vehicle, to acquire isolved and several other majority-owned portfolio companies. This 2019 continuation vehicle included a significant commitment to fund follow-on investments, allowing isolved to continue to execute its organic growth and acquisition strategies. During its time in the CV III Fund, isolved grew its revenue and profitability by nearly three times.
Heartwood Partners exits its investment in M&Q Holdings with sale of M&Q Packaging
Heartwood Partners announced that Heartwood Partners II, LP (“Fund II”) and affiliated entities sold their investment in M&Q Packaging. (“M&Q Packaging,” or the “Company”). This sale, in combination with the previously announced sale of Outlook Group, completes Heartwood Partners’ investment in M&Q Holdings (“M&Q”).
M&Q Packaging designs and manufactures proprietary high-temperature resistant thermoplastic nylon, polyester, and polyamide packaging solutions for the protein, foodservice, and specialty markets. The Company’s film and flexible packaging solutions ensure customers’ products are optimized for performance, cost-efficiency, and quality.
Under Heartwood Partners’ ownership, M&Q Packaging strengthened its management team with key strategic hires and made significant investments in proprietary manufacturing equipment and technology to expand capacity, streamline operations, and drive product innovation and quality. Additionally, the Company completed the acquisitions of FlavorSeal, which added proprietary spice transfer capabilities, and Zoop, which enhanced manufacturing capabilities and accelerated growth in the foodservice market.
New Mountain Capital Announces Sale of Cleaning Solutions Provider Zep Inc. to Truelink Capital
Zep Inc. (“Zep”), an innovator and manufacturer of maintenance and cleaning solutions for industrial, commercial, and residential markets, announced that it had been acquired by an affiliate of Truelink Capital Management, LLC (“Truelink”), a Los Angeles-based middle market private equity firm focused on long-term value creation, from New Mountain Capital, a growth-oriented investment firm with more than $55 billion in assets under management.
Founded in 1937, Zep has built a legacy of trust, performance, and innovation in the specialty chemical sector, serving customers across industries with high-performance maintenance, cleaning, and sanitation products. Zep will build upon the operational foundation and growth trajectory established under New Mountain’s ownership to further strengthen and expand its solutions portfolio and market presence under Truelink’s stewardship.
Insight agrees $5.1bn sale of Dotmatics to Siemens
Siemens AG agreed to acquire U.S.-based R&D software firm Dotmatics for $5.1bn from private equity firm Insight Partners, according to a report by Reuters.
The transaction represents a significant exit for Insight Partners, which acquired Dotmatics in 2017 and has since scaled the business through strategic investments and bolt-on acquisitions.
The deal highlights the increasing appetite among strategic buyers for high-growth software assets in the life sciences industry, where digital transformation and AI-powered research tools are becoming increasingly vital.
Financing for the acquisition will be supported primarily by share sales of listed Siemens entities, including its healthcare subsidiary Siemens Healthineers, according to Siemens CFO Ralf Thomas. The German conglomerate expects the deal to expand its total addressable market for industrial software by $11 billion, reinforcing its focus on digitalization within the life sciences space.
Blackstone acquires Cvent stake from Vista in $1.3bn deal
Blackstone acquired the remaining stake in U.S.-based Cvent from Vista Equity Partners for $1.3bn, reported Bloomberg, citing sources. The transaction marks Vista’s complete exit from Cvent, a Virginia-based software company. Vista retained this stake following Blackstone’s $4.6 billion acquisition of Cvent in 2023.
Cvent’s platform provides software tools designed for event planners and marketers, enabling online registration, venue sourcing, event marketing and management, virtual and in-person event solutions, and attendee interaction. Founded in 1999, Cvent had more than 5,000 employees and more than 24,000 customers worldwide as of 12/31/24.
Vista initially invested in Cvent in 2016, purchasing the company for approximately $1.7billion.
Risk of investing Discussed below are the investments generally made by Investment Funds and the principal risks that the Adviser and the Fund believe are associated with those investments and with direct investments in operating companies. These risks will, in turn, have an effect on the Fund. In response to adverse market, economic or political conditions, the Fund may invest in investment grade fixed income securities, money market instruments and affiliated or unaffiliated money market funds or may hold cash or cash equivalents for liquidity or defensive purposes, pending investment in longer-term opportunities. In addition, the Fund may also make these types of investments pending the investment of assets in Investment Funds and Co-Investment Opportunities or to maintain the liquidity necessary to effect repurchases of Shares. When the Fund takes a defensive position or otherwise makes these types of investments, it may not achieve its investment objective. The value of the Fund’s total net assets is expected to fluctuate in response to fluctuations in the value of the Investment Funds, direct investments and other assets in which the Fund invests. An investment in the Fund involves a high degree of risk, including the risk that the Shareholder’s entire investment may be lost. The Fund’s performance depends upon the Adviser’s selection of Investment Funds and direct investments in operating companies, the allocation of offering proceeds thereto, and the performance of the Investment Funds, direct investments, and other assets. The Investment Funds’ investment activities and investments in operating companies involve the risks associated with private equity investments generally. Risks include adverse changes in national or international economic conditions, adverse local market conditions, the financial conditions of portfolio companies, changes in the availability or terms of financing, changes in interest rates, exchange rates, corporate tax rates and other operating expenses, environmental laws and regulations, and other governmental rules and fiscal policies, energy prices, changes in the relative popularity of certain industries or the availability of purchasers to acquire companies, and dependence on cash flow, as well as acts of God, uninsurable losses, war, terrorism, earthquakes, hurricanes or floods and other factors which are beyond the control of the Fund or the Investment Funds. Unexpected volatility or lack of liquidity, such as the general market conditions that prevailed in 2008, could impair the Fund’s performance and result in its suffering losses. The value of the Fund’s total net assets is expected to fluctuate. To the extent that the Fund’s portfolio is concentrated in securities of a single issuer or issuers in a single sector, the investment risk may be increased. The Fund’s or an Investment Fund’s use of leverage is likely to cause the Fund’s average net assets to appreciate or depreciate at a greater rate than if leverage were not used. The Fund is a non-diversified, closed-end management investment company with limited performance history that a Shareholder can use to evaluate the Fund’s investment performance. The Fund may be unable to raise substantial capital, which could result in the Fund being unable to structure its investment portfolio as anticipated, and the returns achieved on these investments may be reduced as a result of allocating all of the Fund’s expenses over a smaller asset base. The initial operating expenses for a new fund, including start-up costs, which may be significant, may be higher than the expenses of an established fund. The Investment Funds may, in some cases, be newly organized with limited operating histories upon which to evaluate their performance. As such, the ability of the Adviser to evaluate past performance or to validate the investment strategies of such Investment Funds will be limited. In addition, the Adviser has not previously managed the assets of a closed-end registered investment company. Closed-End Fund; Liquidity Risks. The Fund is a non-diversified closed-end management investment company designed principally for long-term investors and is not intended to be a trading vehicle. An investor should not invest in the Fund if the investor needs a liquid investment. Closed-end funds differ from open-end management investment companies (commonly known as mutual funds) in that investors in a closed-end fund do not have the right to redeem their shares on a daily basis at a price based on net asset value. |