BNPP AM Prime eyes up to five European GP stakes from current vintage; Providence to acquire valuation and property risk data biz
Good morning, Nina Lindholm here with the Europe Wire from the London newsroom.
European GP stakes are in the spotlight this morning, as PE Hub’s Craig McGlashan speaks to Pascal Christory, CEO of BNPP AM Prime, to learn about the firm’s pipeline and what he believes will drive more European GP stakes deals.
To finish, we’ll look at Providence Equity Partners’ agreement to acquire Hometrack, a provider of residential real estate digital valuation and property risk data and analytics in the UK and Netherlands.
Underserved market
From consolidation to succession planning, fundraising concentration to growth, the European GP stakes market has much potential momentum behind it. But activity still lags well behind the US. PE Hub caught up with Pascal Christory, CEO of BNPP AM Prime, to learn about his firm’s “super-exciting” pipeline and what he believes will drive more European GP stakes deals.
BNPP AM Prime closed Prime Capital Partners I, AM Alts’ first fund dedicated to GP stakes, at €540 million earlier this year, above its original €400 million target, with Axa the anchor investor.
It was the largest GP stakes fund yet raised by a European manager, according to the firm. But it’s still small beer compared with the sums raised by US firms. Blue Owl Capital has raised $10.6 billion of its $13 billion target for its sixth GP stakes flagship, for instance, according to an earnings call in late July.
That gap in the European market was something that inspired Christory to found then-named AXA IM Prime in 2022.
“We thought it was an underserved market, with almost no players in Europe,” he said. “I saw as well this huge success in attracting capital in the US. But that corresponded with a palatable need in the market.”
The firm became BNPP AM Prime after BNP Paribas bought Axa Investment Managers last year, with Christory also taking on the position of global head of PE at BNPP AM Alts. He was previously CIO of the Axa Group.
The firm has made seven investments, including a 5.9 percent stake in mid-market investment firm Committed Advisors in July. Last year it acquired a stake in Hayfin Capital Management from Arctos Partners, a stake in private credit market company Monroe Capital and a 15 percent stake in European mid-cap private equity firm Latour Capital.
The firm is targeting 10-12 investments per fund, leaving it with around three to five to fully deploy in its current vintage.
The total addressable market is huge. There are more than 500 mid-market European GPs, according to BNPP AM Prime’s estimates, with mid-market defined as European GPs managing €1 billion-€10 billion in private equity or infrastructure, and €5 billion to €20 billion in private debt. Ninety percent of those are yet to sell a stake, Christory added.
“We estimate that there is €200 billion of enterprise value in those mid-market GPs. But if you look at just the financing from GP stakers in Europe, it’s less than €1 billion,” he said. “Obviously, there is an asymmetry between the growth of the industry, the growth of the GPs, the enterprise value of the GPs, and the growth of GP stakes.”
For Christory’s take on why the European GP stakes market is lagging behind the US, check out Craig’s full piece.
Seamless journeys
Away from GP stakes, Providence Equity Partners announced on Friday it has entered into an agreement to acquire Hometrack, a provider of residential real estate digital valuation and property risk data and analytics in the UK and Netherlands.
Hometrack’s data aids decision-making across the residential real estate asset class, including for financial services firms, public and private property investors and insurers. Hometrack serves 16 of the top 20 UK mortgage lenders and all of the top 14 Dutch mortgage lenders, according to a press statement.
Providence plans to work alongside Hometrack’s management team to support continued investment in innovation, product development and customer service.
“As lenders continue to digitize their operations and deliver faster, more seamless mortgage journeys for customers, we believe Hometrack is well positioned for long-term growth,” said Robert Sudo, senior managing director at Providence, in the statement.
Software for various parts of the property segment has been popular lately. For a round up of recent proptech deals, check out this Europe Wire from July.
That’s all from me this morning. Rafael Canton will fill in for MK Flynn on the US Wire later today, and Craig McGlashan is on Europe duty tomorrow.
Cheers,
Nina
