A new fund created by a syndicate of limited partners has acquired all of Bank of America Merrill Lynch’s non-real estate private equity portfolio in Asia. The newly-established private equity manager – named NewQuest Capital Partners – is a spin-out from Bank of America Merrill Lynch’s private equity arm and is backed by a consortium consisting of Paul Capital, HarbourVest Partners, LGT Capital Partners and Axiom Asia.
The acquisition has been done by NewQuest Asia Fund I, L.P., which will be a fund focused on investment opportunities in Asia. The Bank of America Merrill Lynch Asia private equity team will continue to manage the portfolio as part of NewQuest Capital Partners, a statement said. The financial terms of the deal are not disclosed.
The acquired portfolio consists of over 20 growth-equity and buyout interests primarily in Chinese and Indian companies focused on domestic economies. Merrill Lynch Global Private Equity’s current India portfolio includes DRS Warehousing Pvt. Ltd, Pipavav Shipyard Ltd, and Vestas RRB India Ltd. It has also invested in Salarpuria Group’s five-star hotel project SPV, but real estate deals are not part of this spin-off.
“The fund will also have capital reserved to make new and follow-on investments with an emphasis on the purchase of direct secondary equity positions in Asia,” the statement said.
The NewQuest Capital Partners private equity team will be led by Darren Massara, as Managing Partner, and Amit Gupta, Bonnie Lo, and Min Lin as Partners – all formerly of Bank of America Merrill Lynch’s Asia private equity team.
“Darren and his partners are one of the most promising teams in the Asian private equity market with deep knowledge and understanding of the region and its growth prospects. They have built a portfolio of assets which we believe has a very attractive profile and we look forward to working with them and our valued partners in the buyer syndicate to maximize the value of these investments for our investors,” said Bryon Sheets, a Partner at Paul Capital.
Darren Massara said, “The partnership with Paul Capital, HarbourVest, LGT Capital Partners and Axiom Asia will allow our team to continue to harvest our existing portfolio on a seamless basis, as well as execute on our unique investment strategy for the Asian market. We look forward to our future as NewQuest Capital Partners.”
“The establishment of NewQuest Capital Partners is an important milestone in the development of Asia’s private equity market as it is the first transaction of its kind in the region. Building on our history as the first dedicated secondary investment firm to open an office in Hong Kong, we look forward to continuing the development of the region’s secondary private equity market by deepening our relationship with the NewQuest team,” said Jason Sambanju, Managing Director at Paul Capital in Hong Kong.
Founded in 1991, Paul Capital manages $4.6 billion in capital commitments in its secondary private equity program. The firm has offices in Hong Kong, London, New York, Paris, San Francisco and Sao Paulo. The firm has completed more than 175 secondary market acquisitions of limited partnership interests and portfolios of direct private equity investments.
Since 1984, HarbourVest Partners, LLC has acquired $8 billion of assets in over 350 deals of all stages, types, vintages, and geographies and working with all types of sellers, including financial institutions, corporations, pension plans, governmental entities, endowments, and family offices.
LGT Capital Partners currently manages $21 billion in hedge fund and private equity investments on a global basis. The firm is responsible for managing the Castle and Crown alternative investment programs, and is headquartered in Pfaeffikon, Switzerland, with offices in New York, London, Dublin, Hong Kong and Tokyo.
Axiom Asia is an independent private equity fund of funds manager focusing on primary fund investments in buyout, venture capital and growth capital opportunities in the Asia Pacific region. With 11 investment professionals based in Singapore, Axiom Asia is an active buyer of Asian secondary interests.