In brief : HarbourVest Global Private Equity (HVPE) sold part of its portfolio on the secondary market, at a price close to book value, while its own shares traded at a discount of around 25%. A textbook case of how a trust can use the secondary market to narrow the gap between its share price and its NAV.
HVPE and the secondary market: selling assets to narrow the discount
What happened
On 16 December 2025, HVPE, a London-listed private equity trust managed by HarbourVest Partners, announced the sale of five positions in buyout-focused HarbourVest funds: one co-investment fund and four funds of funds. Together they represented 7.7% of its net assets at 30 June 2025.
The price was $300m, or 94% of the funds’ carrying value, a 6% discount. The sale also reduced the trust’s unfunded commitments, the money promised to funds but not yet paid in, by $105m.
In April 2026, the board set out a six-point plan: 100% of secondary sale proceeds to be returned to shareholders, at least $500m returned in 2026 (including a $400m tender offer and $100m of share buybacks), a pause on new commitments and a continuation vote no later than July 2029. On 1 July 2026, a second sale, mainly of co-investments, raised $70.7m.
In its half-year results published on 22 October 2026, HVPE reported NAV of $60.82 per share at 31 July 2026 and a 25% discount. The tender offer, of up to $400m, is to be priced at around 10% below NAV, with a general meeting on 16 November 2026.
What it tells us
The secondary market allows investors to sell private equity fund interests before the funds reach the end of their life, to specialist buyers. Prices are often slightly below book value: here, 6% below.
The trust’s reasoning comes down to a comparison. Selling assets at 94% of their value, then buying back its own shares at around 75% or 90% of NAV, mechanically increases NAV per share for the shareholders who remain. This is known as an accretive effect.
The choice also has a cost: the portfolio shrinks, the assets sold will no longer benefit the trust, and the pause on commitments slows its renewal. A discount can narrow, but no plan can guarantee that it disappears.
Les notions à retenir
Secondary market :
The market where existing interests in unlisted funds change hands before the end of the fund’s life.
Tender offer :
An offer to shareholders to buy back part of their shares at a set price, often below NAV.
Unfunded commitments :
Money promised to funds but not yet paid in. Reducing them lowers future cash needs.
Accretive effect :
Buying back shares below NAV increases NAV per share for the remaining shareholders.
Sources : HVPE, asset sale announcement, 16 December 2025 – Yahoo Finance, six-point plan, 14 April 2026 – HVPE, asset sale, 1 July 2026 – HVPE, half-year results, 22 October 2026
AVERTISSEMENT
This article is for educational purposes only. It does not constitute investment advice, a recommendation, or a solicitation to buy or sell any security. Past performance is not a reliable indicator of future results.