Private equity executives defend continuation funds amid LP concerns
Senior executives from Leonard Green & Partners, Hamilton Lane, Carlyle and Bain Capital have defended the growing use of continuation funds, arguing that the structures provide liquidity and support longer-term value creation despite investor concerns over potential conflicts of interest, according to a report by Bloomberg. Speaking at the Global Financial Leaders’ Investment Summit in Hong…
Executives from leading private equity firms defended the increasing use of continuation funds during a recent summit, reassuring investors of their benefits amid growing concerns over potential conflicts of interest. Leonard Green & Partners' Jonathan Sokoloff acknowledged resistance from limited partners but maintained that these vehicles had become an integral part of the market.
Hamilton Lane's co-CEO Juan Delgado-Moreira explained that independent valuations and investor advisory committee approvals address these concerns, highlighting that assets transferred into continuation vehicles have historically achieved average investment multiples of about four times, surpassing top-quartile buyouts. Carlyle co-president John Redett noted that higher interest rates are steering the industry towards operationally driven returns, emphasizing the importance of active value creation.
Meanwhile, Bain Capital's chairman John Connaughton suggested that evolving industry dynamics could signal a new era of robust private equity performance.
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- Private equity executives defend continuation funds amid LP concerns privateequitywire.co.uk
