Credit Suisse Group AG, Switzerland’s second-biggest bank, agreed to sell its stake in the first fund of Global Infrastructure Partners to Lexington Partners Inc., according to a person with knowledge of the matter.
The deal with Lexington Partners, one of the largest firms dedicated to buying existing private-equity holdings, is expected to be completed by the end of March, said the person, who asked not to be named because the information isn’t public. The Zurich-based bank’s stake was valued at about $590 million in net assets plus uncalled capital commitments as of Sept. 30.
Rebecca John, a partner at New York-based Lexington Partners, declined to comment on the sale process, as did Katherine Herring, a spokeswoman for Credit Suisse, and Jack Cowell, a spokesman for New York-based GIP.
Credit Suisse is selling its $500 million investment in the fund as it strives to strengthen (CS:US) its capital base. Several financial institutions have sought to unload stakes in private- equity funds to address regulatory pressure to eliminate riskier assets and those that aren’t central to their businesses. Lloyds Banking Group Plc, Citigroup Inc., Barclays Plc, Credit Agricole SA and HSH Nordbank AG are among firms that have turned to the so-called secondary market to offer fund stakes in recent years.
GIP, founded in 2006, raised $5.46 billion for its debut fund in 2008 with commitments from Credit Suisse and General Electric Co.
Credit Suisse, whose private-fund unit is managing the stake sale, decided against backing the firm’s follow-up fund, Global Infrastructure Partners II LP, which closed at $8.25 billion in October, two people briefed on the matter said in January. The second fund became the largest pool focused on infrastructure buyouts.
GIP is led by Adebayo Ogunlesi, previously head of investment banking at Credit Suisse First Boston, the bank’s securities unit. The firm owns 42 percent of Gatwick Airport Ltd. in the U.K. and 75 percent of London City Airport, according to its website.
Lexington Partners, which manages both secondary private- equity and co-investment funds, was founded in 1994 and has $21 billion in committed capital, according to its website. In 2011, the firm raised $7 billion for Lexington Capital Partners VII LP and associated funds to invest on the secondary market.
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