The sector\u0027s reset from frothy valuations and record activity has created opportunities on the private side, CPPIB says
But Leon Pedersen, who was selected to lead a team dedicated to doing just that at the Canada Pension Plan Investment Board , said the timing couldn’t be better.
“Some really high-quality growth companies have gone public over the past couple of years, maybe even too early ,” said Pedersen, who spent more than two decades at Copenhagen-based Nordea Investment Management AB earlier in his career. With the markets punishing tech companies, CPPIB’s team might find some of those are ready “to think about public-to-private transactions,” he added.
Alibaba paid off in 2014, at least on paper, when the company went public with a value of US$25 billion, though the company subsequently faced domestic regulatory and consumer challenges. Among the investments made so far this year are California-based Eikon Therapeutics Inc., which uses computing to track and measure movements of proteins in living cells in order to discover new medicines, and N26 GmbH, a branchless European bank based in Germany.Article content
The growth equity team will be able to take advantage of CPPIB’s “one-fund approach,” Pedersen said, adding that being a unit within a large and diversified fund with access and expertise in private equity, as well as credit and secondary markets, is a key ingredient that will help it compete with others chasing growth assets.Article content