ASSET ALLOCATION

This section details the allocation of investments between the different asset classes within private markets, such as secondary investments, primary investments and direct investments, as well as the proportion of liquid assets (held in the liquid sleeve). It provides an overview of the portfolio's composition and can be adjusted at any time.

Strategy/sub asset-class exposure (% net asset)

Data as of:  30 Sep 2024.
Liquid Sleeve
44.8 %
Secondaries Co-Investments
43.8 %
Direct Co-Investments
9.2 %
Secondaries Fund Investments
2.2 %
Primaries
0.0 %

Top investment exposures

This section provides an overview of the largest holdings of the fund, including detail on the specific types of investments and their respective weightings as a percentage of the fund's overall assets.

Top investment exposures (% Net Asset)

Data as of:  30 Sep 2024.
Project Michigan23.1%
Project Roland12.5%
Project Volt9.3%
Project Luigi 8.2%
Clipway Secondary Fund 12.2%
Total
55.3 %

Comments from the Investment Team

Read the Investment team's analysis below.

Carmignac Private Evergreen Monthly comments

Data as of:  30 Sep 2024.
The Investment team

Edouard Boscher

Head of Private Equity

Megan Noelle Chew

Portfolio Manager

Alexis de Chezelles

Portfolio Manager

Market Environment

  • Private Wealth market: A significant market representing c.$200tn assets globally according to BNP Paribas, with allocation to private markets standing at <3% for private investors vs. c.14% for institutional investors (Bain PE Report '23), indicating significant white space for further private market exposure for the former. Semi-liquid funds have demonstrated strong uptake over the past few years, and is estimated to represent c.$400bn globally to date according to iCapital.

  • Secondaries deal volume: The Secondary market delivered strong results in H1 2024, with total transaction volume at $72bn, setting a new record for H1 deal volumes. LP-led deals represented 57% of H1 2024 transactions (GP-leds: 43%), with LP-led deals seeing continued momentum driven by liquidity needs. Optimistic outlook for H2 2024 volumes given expected higher transaction volumes typically observed in the second half of the year.

  • Secondaries pricing: Pricing of LP-led Secondary deals is on the high side, underscoring the need to be disciplined and offer other non-price attributes such as speed and reliability of deal execution and deal structuring to remain competitive. Convergence of bid-ask spreads seems to increase driven by favourable investor sentiment according to Evercore.

Performance Commentary

  • Overview: In September 2024, the Net Asset Value (“NAV”) of Carmignac Private Evergreen (EUR A) increased by +0.8%. This performance was mainly driven by a new investment in Project Roland and slightly offset by the effect of the capital deployed as part of Project Luigi.

  • Project Roland: Cherry-picked LP-Interest Secondary deal entailing the acquisition of a mature portfolio, granting access to four large leading managers: KKR, Blackstone, Warburg Pincus and TPG. Highly diversified portfolio of 118 companies acquired at attractive pricing of 14% discount to NAV at closing. Complementary liquidity profile with existing evergreen portfolio: shorter duration; >100% of capital expected to be returned in 2 years. Exposure to target geographies: primarily in the US (c.50% of NAV at Record Date), and Europe (c.30% of NAV at Record Date).

  • Project Luigi: LP-Interest Secondary deal entailing the acquisition of a high-quality portfolio of 9 companies in FSI Fund I managed by FSI – an Italian GP, with a robust reputation in growth and mid-market investments. 3 investments made through FSI Fund II since the beginning of the year: (i) Nice: Develops smart home equipment such as automated gates and doors, smart security systems, and smart home devices. (ii) Retex: Offers tailored services to enhance operational efficiency and customer engagement in retail businesses. (iii) Bancomat: Provides electronic payment solutions and banking services, including a range of debit and credit cards and ATM networks.

Outlook and Investment Strategy

  • Investment Strategy: Focused on Secondaries, Carmignac Private Evergreen allows us to offer a one-stop-shop Private Equity solution for investors looking to build a diversified exposure to high quality buyout companies from Day 1. Our target allocation includes a focus on Secondaries through co-investments featuring attractive terms, while investing opportunistically in high-conviction direct co-investments to generate alpha. Primary investments will be considered later on in the Fund’s life. Secondaries offer an attractive risk-return profile, thanks to the possibility to negotiate favourable terms and structuring such as discounts and deferred payments and offers numerous benefits such as a reduced J-curve effect and blind-pool risk. It is a unique asset class with low correlation with both public and other private market strategies, which reiterates the complementarity of public and private strategies within an investment portfolio.

  • Outlook: Today our portfolio offers exposure to >100 companies, highly diversified across sectors, geographies and vintages, while still maintaining a focus on developed markets and private equity buyouts. We continue to see high-quality deal flow and currently reviewing two advanced secondary deals in the pipeline that we expect to close by September and November respectively, pending investment committee approval for the latter. As the Fund is still in its ramp-up phase, the liquid sleeve of the portfolio is much larger than its intended allocation. We expect this to normalize by end-2025. Of note, the liquid sleeve is actively managed and invested in a curated range of Carmignac’s fixed income and credit funds.

Reference to certain securities and financial instruments is for illustrative purposes to highlight stocks that are or have been included in the portfolios of funds in the Carmignac range. This is not intended to promote direct investment in those instruments, nor does it constitute investment advice. The Management Company is not subject to prohibition on trading in these instruments prior to issuing any communication. The portfolios of Carmignac funds may change without previous notice.
The reference to a ranking or prize, is no guarantee of the future results of the UCIS or the manager.