This edition captures takeaways from DealStreetAsia’s inaugural Leadership Roundtable, titled Asia Secondaries 2025, featuring candid discussions between GPs and LPs on continuation vehicles and alignment strategies.
When to execute CVs?
In Asia, where fund maturities, capital constraints, and uneven exit markets collide, the decision to execute a continuation vehicle is increasingly a question of judgement rather than playbook.
At the inaugural DealStreetAsia’s Leadership Roundtable on Asia Secondaries 2025, presented by LGT Capital Partners, participants spoke about how they have navigated continuation vehicles in practice.
“Waiting until the very end of a fund’s life can send mixed signals, suggesting there are no alternatives and that the GP is acting out of necessity. In ChrysCapital’s case, it was different; they were effectively executing one of the first meaningful CVs at the time. It’s a learning process, of course, but for future transactions, six to seven years is likely the optimal window,” said Dennis Kwan, Managing Director, Private Capital Advisory at Jefferies.
In April 2024, ChrysCapital closed a $700 million continuation fund to retain its stake in NSE, India’s leading stock exchange.
Jeffries typically advises GPs to begin evaluating continuation vehicles or other liquidity options around year six or seven. In the US, the average holding period before a continuation vehicle for a marquee asset is about 4.8 years.
The focus, noted Peter Lui, Principal at LGT Capital Partners, is really on understanding the dynamics behind a mid-life continuation. At that stage, primary support can be most impactful. Once a CV is executed and an asset moves out of the fund, returns for that fund are effectively locked in. But if the asset still has several years to run, it could potentially compound further, perhaps even two to three times more.
The key, he added, is backing the winners at the right time, as that can meaningfully influence overall fund performance.
Alternative structures
Timing isn’t the only constraint, stressed Brian Lim, Partner and Head of Pantheon’s Asia and Emerging Markets Investment teams. Even midlife into an asset, a fund can run into capital limitations, having exhausted per-investment allocations or leverage capacity. In such cases, additional equity can’t be deployed within the fund, even though the asset still has a runway.
He suggested alternative structures to extend capital, while still allowing the original GP to maintain control of the asset, albeit under a different structure, rather than sharing governance with new GPs.
Manish Kejriwal, Founder & Managing Partner, Kedaara Capital, explained that if, say, Lenskart needed an additional $100 million mid-cycle, the key question for the LP is whether the GP is acting with genuine cause. “If there’s a real reason, then there’s no issue with proceeding,” he said.
Kedaara Capital closed its first $300 million continuation fund, transferring partial stakes in Lenskart Solutions and Carehealth Insurance into the vehicle.
GP contribution
From a GP perspective, alignment is demonstrated through meaningful GP contribution. For a high-conviction asset, increasing the original commitment, rather than simply rolling it over, signals real confidence to LPs.
“If a GP isn’t doubling down in such circumstances, that would be a red flag for me as an LP,” added Kejriwal.
Saurabh Chatterjee, Managing Director at ChrysCapital, emphasised that alignment was paramount. They chose not to crystallise any carry; all proceeds from the NSE sale were rolled into the continuation fund, keeping the GP fully aligned for the coming years. They also avoided selling at a discount to NAV. While secondaries often involve discounts, the NSE stake was a marquee, relatively liquid asset, requiring limited price discovery. Pricing was based on a three-month weighted average to reflect fair value.
Though this approach extended the process, it reinforced alignment.
If the GP is unable to generate any carry from the existing fund, Liu said, mechanisms like GP commitment subordination, where the GP allows LPs or new investors to receive proceeds before their own rolled-over commitment, can help build alignment and conviction.
Some GPs may need backing but still have strong portfolios; these are the ones LPs tend to support. By contrast, when capital is tight, and a few assets are performing well but no carry is available, the challenge is in deciding how to proceed.
“We’ve seen situations like this across India, China, and Southeast Asia,” Kwan added, highlighting the nuances GPs and LPs navigate in these mid-life continuation scenarios.
Access the full Asia Secondaries 2025 PDF for in-depth insights on CV structures, pricing and discounts.
Top Developments
Deals
Bain Capital is considering carving out Tanabe Pharma’s ex-Japan assets after striking a $3.3-billion deal to acquire the pharmaceutical unit of Mitsubishi Chemical Group in February.
Fundraising
Granite Asia has secured a $350-million first close for its debut private credit fund, anchored by three SE Asian sovereign wealth funds: Temasek, Khazanah and the Indonesia Investment Authority. Navis Capital Partners is also understood to be near the final close of its first credit fund.
On the private equity front, Ikhlas Capital has surpassed the $300-million target for its second fund. The fund’s anchor LP base is understood to include some of Southeast Asia’s most prominent institutional investors, such as Singapore state investor Temasek, and Malaysia’s major pension schemes, the EPF and KWAP.
China LP Secondaries
La Caisse, formerly CDPQ, is considering a potential sale of around $1 billion in private fund stakes. The initial offering primarily consists of Chinese-managed vehicles or funds with assets in Greater China, with Greenhill & Co. advising.
SAFE Investment Company, a Hong Kong-based arm of China’s State Administration of Foreign Exchange, is reportedly in advanced talks to sell a $1 billion portfolio of private fund stakes, following two earlier bidding rounds. Campbell Lutyens is acting as the sell-side advisor.
