Pantheon Ventures has declined a $500 million mandate from the China Investment Corp (CIC), a sovereign wealth fund that has been ramping up its exposure to private equity via separate accounts targeting the secondaries market.
A source said Pantheon found the terms unfavourable but was unable to provide further detail.
The firm's decision to reject the mandate due to “the proposed conditions”, first appeared in the US trade publication PE Insider, which reported that Lexington Partners and Goldman Sachs were to share the $500 million mandate instead. That reported development indicates Lexington and Goldman would manage a total of $750 million each for CIC.
Pantheon, Goldman and Lexington had been selected to manage $500 million each for CIC for secondaries-focused investments, according to a report in the Financial Times published in February. The article noted that CIC had reviewed more than 30 potential secondary managers over a year-long period prior to settling on the trio.
Pantheon declined to comment. Lexington and Goldman could not immediately be reached for comment.
Some large secondaries players were reportedly unable to strike a deal with CIC as creating a special account for one investor may conflict with the interests of other investors. “Splitting portfolios creates transfer pricing issues and there will be winners and losers,” Jeremy Coller, founder of secondaries giant Coller Capital told the Financial Times, quipping “we are not clever enough to manage the conflicts”.
Private Equity International recently published an in-depth interview with Pantheon's leadership. Click here to read the article in full.