The investment activities, processes and investment teams are the same for both primaries, secondaries and
co-investments. Our underlying philosophy for this is that the relationships with our General Partners formed
through primary investing are essential to sourcing and executing secondary investments as well as co-investments.
The combination of our ongoing and thorough screening processes, our longstanding history and relationships and our
experience as an investor in the lower-middle market makes us able to navigate and execute fund commitments in the
appealing subset of private equity funds that are hard to find, hard to access and hard to diligence.
Primary fund investments, i.e. investments through lower-middle market private equity funds into portfolio companies
is an effective way to obtain a diversified exposure to the private equity asset class.
The primary activity of
Danske Private Equity focuses on capturing alpha by getting access to specialized strategies and segments across the
North American and Western European lower-middle market. For this purpose, we are constantly broadening and
maintaining our extensive network of relationships with lower-middle market private equity fund managers.
Secondary fund investments involve buying and selling pre-existing investor commitments to private equity funds.
Secondary investing is an efficient way of getting vintage diversification into the portfolio and thereby also
mitigating the initial return impact of early fees against later returns commonly referred to as the J-curve.
As Danske Private Equity primarily sources these opportunities among previous and current portfolio funds, our
approach to secondary investing builds on our primary investment activity and is consistent with our overall
investment philosophy. Hence, our secondary efforts focuses on less competitive situations where the process is
either controlled by the fund manager or directly sourced from other investors. Our secondary strategy generally
targets smaller transactions in quality funds and managers that are well-known to the investment team.
By directly investing into portfolio companies alongside our General Partners and possibly other third party
investors, Danske Private Equity expects to achieve higher returns, increased portfolio transparency, higher control
and a reduction in overall fees for our investors.
Co-investments represents a unique opportunity to leverage the relationship with the portfolio funds in terms of fund
and portfolio company insights, but we believe that investing directly alongside our should only be pursued when all
parties - the portfolio company as well as investors and the fund manager - can benefit from it. Our approach has
been to leverage our strong primary fund manager relationships. In addition to the requirement that any transaction
be within their core strategy, there must be maximum alignment of interest with the fund manager. Given the more
concentrated nature of co-investments, great care is taken in the fund manager’s investment analysis and allocation
Environmental, Social and Governance policy
Danske Private Equity has had a responsible investment policy since 2002, developed in dialogue with investors and
based on the UN Global Compact. Ongoing development of tools and processes draws on the resources and insights of
Danske Bank Group’s dedicated ESG functions. Screening for ESG criteria and goals forms an integrated part of the
investment selection and monitoring processes. This approach is continuously being refined with an aim to promote
corporate responsibility regarding environmental matters, labour rights and anticorruption.
Danske Private Equity co-operates with Danske Wealth Management Sustainability and Impact Investment on the updating
of ESG selection and monitoring processes as well as with Danske Wealth Management Alternative Investments on the
development of selection and monitoring processes in anticipation of regulatory developments.
For further information regarding ESG please refer Danske Bank Group’s policies for Sustainable Investments which can
be found here.
More than anything else, ESG is to me about good business
- Claus Heimann Larsen, CEO & Managing Partner,
Dankse Private Equity