Selling the management entity of a GP fund seems to be an option / exit strategy for large PE funds and their retiring executives. I am not talking about the fund itself.
Does anyone know about any specific deals and how these operations/management entities are valued? For example, Exeter Property group sold its management company to EQT a couple years ago for $1.9bn. Assume that once you are managing multiple funds (they were multiple Billion $ under management), your Advisors/management company to the fund becomes a HUGE fee machine that obviously can be valued at xxx.
Following. If I'm understanding, you're asking how to value a REPE firm apart from its ownership in real estate. So purely the management aspect of the firm is what would be sold.
Yes exactly.
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TA Realty did this to that Japanese company. I’d be interested in knowing the details.
As you’d typically value any operating company, multiple on revenues or EBITDA and a discounted value of carry (if that’s earned by the same company, often times it’s not). It’d also depend on how much of the revenues are recurring and how much intangible value you tack on for fundraising and AM which are already built, anchor investors who’re already found, etc. Simplifying it but that’s generally how.
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