General Atlantic and the largest IPO of 2020, Southern Cross nears completion of restructuring on 2010 fund, LPs eye distress, special situations

General Atlantic-backed Royalty Pharma raises $2.2 billion for its IPO.


Hope your week is going well. How you holding up?

IPO: General Atlantic had the largest public offering so far this year, with the IPO of Royalty Pharma, which debuted at a nearly $17 billion valuation Tuesday. The company raised $2.2 billion in the offering as shares rose to finish the day at $44.50, writes Sarah Pringle on PE Hub.

Royalty Pharma acquires future royalty streams of drugs and co-funds late stage clinical trials. GA made a $415 million growth investment in the company in February. Other pre-IPO investors include Adage Capital Management and Nogra Group.

Sarah writes that, as drugs become more complex with more stakeholders involved in the research and development process, the royalty market will become more vital and robust. The growth story for Royalty Pharma goes beyond covid-19, she writes. Royalty Pharma’s 22 therapies in its portfolio last year included treatments for rare diseaes, oncology, neurology, HIV, cardiology and diabetes.

Read Sarah’s story here on PE Hub.

Getting Done: One thing about the coronavirus lockdown has been the significant pause of activity on the secondary market.

Secondaries has slowed even more than regular M&A activity, which

has gradually picked up over the past few weeks.
That’s why the completion of a secondary process in this environment is significant. That’s about to happen with a fund restructuring being run by LatAm specialist Southern Cross Group.

The firm is running a process that allows LPs in its 2010 fourth fund to either sell their stakes in the pool or roll their interests into a new fund created to hold remaining assets.

Intermediate Capital Group emerged as sole investor in the process after a three-round auction process. The restructuring is through its election period and moving to completion, sources told me. Fund IV has around $500 million of remaining net asset value across nine investments, sources said. Southern Cross worked with adviser Fairview Capital Group, formed by ex-Park Hill Group executive Pablo Calo.

Read my story here on Buyouts. Have you heard of other processes getting done in the downturn? Hit me up at

It’s significant that Southern Cross is finishing the process even as most other activity stopped. Manager meetings happened in January, before everything shut down. Some other scattered processes have been proceeding through the turmoil, and secondaries is playing a part in helping GPs find ways to get capital to older portfolio companies that need support through the downturn. But most secondaries sources believe we won’t see a major uptick in activity until at least the fourth quarter.

Top Scoops
I heard a lot over the years about LPACs, how big they should get, their responsibilities and whether they are meant to truly represent the full LP base, or just the interest of the largest investors in a fund. The last time I wrote about LPACs, I focused on the seemingly ever-growing size of LPACs as GPs handed out seats like candy as incentives to commit to the fund.

LPACs have become more important over the years as GPs have increased communications with LPs, much of the time distilling messaging through the LPAC. This is especially important in situations like above, when GPs try to deal with older funds or need amendments. The LPAC can help distribute messaging to all investors.

Coller Capital’s Summer 2020 Global Private Equity Barometer survey showed that most LPs think LPACs do a good job, even though most respondents also said LPACs do not represent all investors equally well. I’m going to dive into this issue a bit over the next few days. What do you think? Hit me up at

That’s it! Have a great rest of your day. Hit me up as always with tips n’ gossip, feedback or just to chat at, on Twitter or find me on LinkedIn.