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HarbourVest set to close $1.5 bln co-invest fund in June

  • HarbourVest fund has a $1.5 bln hard cap
  • New fund targeting 15-20 pct net IRR, 2x multiple
  • Fund IV has already called $513 mln for investments

HarbourVest Partners is set to close its latest co-investment fund on its $1.5 billion hard cap in late June, a fund presentation released by Ventura County Employees’ Retirement Association shows.

Ventura County approved a $30 million commitment to HarbourVest Co-Investment Fund IV, subject to final negotiations of terms and conditions, CIO Dan Gallagher said.

Fund IV has raised $1.27 billion so far, HarbourVest’s May 2017 presentation says. An interim close is scheduled for May 31 with a final close slotted for June 28.

The firm has already called $513 million from Fund IV’s existing limited partners for co-investments in deals led by firms like ABRY Partners, Cressey & Co and Stone Point Capital. Its largest deal to date, a $75.1 million investment, was in EQT’s $2.35 billion acquisition of Press Ganey Holdings Inc, which provides patient-satisfaction surveys.

With Fund IV, HarbourVest is targeting 15 percent to 20 percent net internal rate of return and 2x multiple, according to an NEPC memo included in Ventura County’s documents. HarbourVest’s realized portfolio of co-investments has grossed a 19.7 percent IRR, in aggregate, since 1989.

The presentation also noted the fund would charge LPs a 1 percent management fee on invested capital through its first five years. The management fee falls by 20 percent each year thereafter.

HarbourVest has more than $40 billion of assets under management across a variety of private-market platforms, including for funds-of-funds and secondary vehicles. The firm has local teams in Beijing, Bogotá, Boston, Hong Kong, London, Seoul, Tel Aviv, Tokyo and Toronto.

HarbourVest declined comment.

Action Item: For more information on HarbourVest, visit www.harbourvest.com

U.S. $100 bills are seen in this photo illustration at a bank in Seoul August 2, 2013. Photo courtesy Reuters/Kim Hong-Ji