Legend Capital, a subsidiary of China’s Legend Holdings, announced that it has closed its healthcare continuation fund — LC Healthcare Continued Fund I — having raised $270 million from a secondary transaction.
A continuation fund is a vehicle that takes on the portfolio assets of a vintage fund that is nearing the end of its lifespan. LPs are given the option to cash out, or to stay invested by recommitting to the new vehicle.
The latest secondary transaction involved assets from Legend Capital’s two older vehicles, the VC firm said in a statement. The latest fundraising was “co-led by accounts managed by Hamilton Lane and Coller Capital, with participation from other institutional investors”.
Hamilton Lane, a Nasdaq-listed global alternative asset manager, is a long-term limited partner (LP) in Legend Capital. Coller Capital is a UK-based leading investor in the private equity secondary market.
Global leading financial advisory and asset management firm Lazard served as the financial advisor for the deal, while Gibson Dunn and Ropes & Gray acted as legal advisors, according to a company statement.
In February 2020, Legend Capital had announced a $200 million transaction that extended the holding period of its LC Fund IV, by transferring the fund’s assets to a continuation vehicle with a holding period of five years. That deal was exclusively led by Hamilton Lane.
Legend Capital, established in 2001, manages USD funds and RMB funds with a total size of $9 billion with a focus on innovation and growth startups in China and other geographies. As of 2021, Legend Capital has invested in over 500 companies including Bloks Group, RiboBio, Access Medical Systems, Dearer, FITURE, and StoneWise.
Since 2007, the firm ramped up efforts expanding to the healthcare industry. As of now, it has poured more than 10 billion yuan ($1.56 billion) across innovative drugs, biotechnology, medical equipment, diagnostics, medical services, and digital healthcare.
It claimed that nearly 20 of its portfolio companies got listed. This includes Hong Kong-listed cancer screening firm New Horizon Health, Nasdaq-listed US biotech firm NexImmune, and Nasdaq-listed e-commerce platform Wish.
Over the past three years, Legend Capital has created more than 10 billion yuan ($1.56 billion) in cash returns for its limited partners (LPs), it said.
“China’s private equity secondary market has been in growing over years, hereby we expect better opportunities popping up in the future,” said Hamilton Lane co-head of Asia Investments Mingchen Xia in the statement.
Hamilton Lane had collected $3.9 billion for its fifth secondaries vehicle in February this year from pension funds, Taft-Hartley plans, sovereign wealth funds, endowments, foundations, family offices, qualified high-net-worth individuals, and other financial institutions from around the Americas, EMEA, Asia, and Israel.
Legend Holdings is an investment holding company with interests spanning finance, real estate, and information technology. It is a majority owner in the Chinese consumer electronics giant Lenovo.