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Apax sells minority stake to GIC, Future Fund

None of the sale's proceeds have been used to cash out Apax GPs, but rather will be re-invested in a permanent capital vehicle that will invest in Apax funds.

Apax Partners has sold a stake of “around 10 percent” in its management company to Australia’s Future Fund and other investors, the Australian sovereign wealth fund said in a statement.

In August 2008, PEO had confirmed that the firm, originally founded by Sir Ronald Cohen, was in advanced negotiations with three sovereign wealth funds to sell a 10 percent stake.

The firm has sold a 7.7 percent stake in its management company to GIC Special Investments, the private equity arm of the Government of Singapore Investment Corporation, and the Future Fund, the Financial Times reported. It is in talks to sell a stake of another 2.3 percent to a third investor.

The net proceeds from the stake sale are to be re-invested in a permanent capital vehicle in which Future Fund will have a 10 percent stake, the Australian sovereign fund said. The objective of the permanent capital vehicle is to invest in Apax funds.

It added that none of the proceeds of the sale have been used to cash out any of the selling equity partners.

The relationship “gives the Future Fund access to the performance of the management company, existing and future Apax funds”, the Australian fund said.

Future Fund manages assets of about A$59.6 billion ($38.4 billion; E30.2 billion) as of 31 December 2008, of which about 1.8 percent is allocated to private equity.

GIC is the largest sovereign wealth fund in the Asia Pacific with estimated assets of more than $330 billion.

Apax Partners did not respond to a request for comment by press time. GIC could not be reached.

Other sovereign funds have in recent years acquired stakes in private equity firms. Chinese sovereign wealth fund CIC acquired a 9.9 percent stake in Blackstone for $3 billion in mid-2007. In the same year, the Abu Dhabi Investment Authority acquired an undisclosed stake in US buyout group Apollo Global Management. In September 2007, the Carlyle Group sold a 7.5 percent stake worth $1.35 billion to the Abu Dhabi Government fund, Mubadala.

In February 2009, TPG abandoned plans to sell a single digit stake in its management company, having been in talks with the Kuwait Investment Authority, the California Public Employees’ Retirement System and the California State Teachers’ Retirement System. It is not clear whether the stake would have been sold to one or all three of the investors.