The State Administration of Foreign Exchange (Safe) will shell out $1.5bn-$2bn for GM’s positions in blue chip private equity funds, which are managed by firms namely, Carlyle Group, Blackstone and CVC Capital Partners, reports the Financial Times.
Sources close to the matter further revealed to Financial Times that Performance Equity, GM and its affiliates’ pension fund manager, was exploring options to decline investments with private equity groups and to mitigate the risk of their portfolios while also issuing notices to several private equity firms about offloading its fund stakes in the coming months.
As per the general terms, investors in private equity agree to lock up their capital for as long as 10 years, but they can exit by disposing their stake.
Safe is being advised by Lexington Partners on the yet to be finalized deal, which will also administer the complex portfolio and may buy some GM positions that Safe rejects.
