Saturday, 20 April 2024

Alta partners with Scenic for secondaries access

5 min read

Alta Alternative Investments (Alta), one of the leading digital securities exchanges for alternative assets in Southeast Asia, has partnered with US-based investment adviser Scenic Management (Scenic) to launch the Scenic Private Access (SPA) fund on its platform, enabling access to venture secondaries for its global investor community.

Through the SPA fund, Alta will provide direct access to late stage, VC-backed companies that have proven technology and commercially successful products. Later-stage companies typically have reduced risk profiles, as compared to early-stage venture capital opportunities. According to Scenic, the SPA fund has the potential to offer risk-reduced returns of two to three times over the four-year lifecycle of the fund.

Yifei Li, managing director and head of client business at Alta, said: “Secondary investments have grown rapidly over the last decade as an asset class, rising from $11 billion in transaction volume in 2009 to $103 billion in 2022. At Alta too we saw a year-on-year increase of over 300% in order volume on our secondary platform. This partnership with Scenic adds to the vibrant secondaries opportunities on our platform, providing our investor community with an exclusive and compelling option to invest in the booming secondaries space for wealth creation.”

Since emerging, Asia's secondary market has matched global trends, comprising 5% to 10% of global volumes, akin to Asia's representation in primary capital raised globally. In 2022, as aggregate exit values in Asia declined sharply, secondaries constituted 22% of total private equity exits in the region, indicating its rising significance for liquidity. According to consultancy firm EY, secondaries will become a popular exit choice in Southeast Asia for private equity (PE) firms in 2024, after an overall slowdown in the exit landscape last year.

Capturing the latest data on its own secondaries platform, which today lists leading firms across numerous sectors, Alta has issued its “Secondaries Investments” research report in partnership with Singapore-based research and consulting firm Zero One. Alta has discovered that certain secondary investments’ pricing were seeing discounts of over 50% since early 2022, making secondary deals for high-profile, well-performing private companies attractive to investors.

Besides the Scenic Private Access Fund, TikTok’s parent company ByteDance, Epic Games, SpaceX and Revolut are some of the many high-profile private companies that have become easily accessible to investors through secondary deals.

Through secondaries, investors would be able to tap on significant tangible value increases by investing in a business that is in a later stage of maturity, where the business would have discovered how to reliably and sustainably generate revenue and profits.

Mark K Norbury, managing director and head of investor relations and co-invest at Scenic added: “Partnering with Alta marks a significant stride in our mission to create value for investors by exploring forward-thinking solutions. As we explore new horizons in private markets, we are excited about the prospects of expanding access to unique private market opportunities and allowing investors to invest in secondary opportunities in highly sought-after pre-IPO private companies. Alta's proven track record and comprehensive approach to alternative assets complement our vision for a dynamic, interconnected marketplace. Together, we look forward to opening up new avenues for investors seeking new investment opportunities.”

In an era marked by evolving investor demands for liquidity and portfolio diversification, Alta provides diverse investment opportunities in private capital markets, including a wide range of alternative assets. Earlier in January, Alta launched a unique liquidity programme for shareholders of Income Insurance Limited, one of the leading Singaporean insurers. This marked the largest listing of a non-public company on a private securities exchange, enabling institutional and accredited investors to trade and own shares of a non-publicly listed company.

Re-disseminated by The Asian Banker

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