Continuation funds: How much should I price my own masterpiece?
Valuation Advisory, The Netherlands | December 2024
Continuation funds have become a pivotal tool in private equity (PE), allowing General Partners (GPs) to retain control of highperforming assets while providing liquidity to Limited Partners (LPs). However, the central challenge lies in ensuring that the valuation of these transferred assets remains fair and transparent, raising concerns over potential conflicts of interest.
What began as a lifeline for underperforming investments has transformed into a strategic tool for GPs to retain assets while providing liquidity options to investors. But while these funds offer flexibility, they raise one critical question: How fair are the valuations of the assets being transferred from one fund to another?
With GPs effectively selling companies they control to new funds they manage, investors are right to question whether the price they transfer the asset at is fair. This is the core issue—one that has driven regulatory scrutiny and prompted the need for greater transparency.
Download PDF
Talk to the expert - Valuation Advisory
Partner Valuation Advisory
Full profile