Pengana working on plans to launch global private equity listed investment trust


Russel Pillemer

Pengana Capital Group Limited (ASX: PCG), has announced that it is working on plans to launch next year an ASX listed investment trust (‘the Trust’) that will invest in global private equity.

It is proposed that the Trust will provide investors with exposure to a diversified portfolio of private equity investments, including funds, secondaries, directs, co-investments and other opportunistic strategies. This would be Australia’s first global private equity listed investment trust.

PCG is working with Grosvenor Capital Management, L.P. (‘GCM’), who would be responsible for selecting the investments for the Trust and constructing the portfolio. GCM is a global alternative asset manager based in Chicago and, together with its affiliates, has in excess of US$51bn in assets under management in private equity, hedge fund strategies, infrastructure and real estate.

It has a long track record and vast experience in seeking to invest with high-quality private equity managers worldwide, having made investments into 650 underlying private market funds and participated in over 200 direct and co-investment opportunities since 1999.

Sophisticated investors generally recognise that global private equity can be an attractive investment proposition. This is due to the potential for higher returns than traditional stock and bond markets with relatively lower correlations.[1]

Institutional investors are already significantly exposed to global private equity and a recent survey indicates that the majority are planning further increases.[2] An example of this is the Future Fund, which in the year ended June 30, 2018 increased its exposure to private equity to 14.1%, or $20.6 billion, up from 11.6%, or $15.5 billion, a year earlier.[3] In contrast, most Australian retail investors have very little, if any, exposure to this asset class.[4] A key reason may be that many investors and advisers feel that there are a lack of suitable investment options, including the absence of suitable vehicles with daily liquidity.

Russel Pillemer, Chief Executive Officer of PCG said “We have had consistent feedback from clients that they are seeking exposure to global private equity investments, however this asset class can be challenging for retail investors to access. Pengana believes that private equity markets offer compelling investment opportunities and such investments should play a role in many investors’ asset allocation. We have selected GCM as our investment partner due to their excellent reputation and credentials in this space.”


[1] Source: BURGISS, MSCI. BURGISS data based on published 4Q 2017 benchmark data downloaded on June 22, 2018. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used to create indices or financial products. This information is not approved or produced by MSCI. Past performance is not a reliable indicator of future performance. The value of investments can go up and down. There are, of course, risk associated with private equity investments. Such risks will be addressed in the Product Disclosure Statement for the Trust.
[2] Sources: Preqin Ltd June 2018. Future Fund’s quarterly portfolio update at 30 June 2018
[3] Source: Future Fund’s quarterly portfolio update at 30 June 2018
[4] Source: AFSA’s April Superannuation Statistics

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