Azimut Alternative Capital Partners is on the hunt for stakes in midsize private-markets investment firms, betting that the power of permanent capital and access to global markets will help it win deals.
“GPs are interested in more than just getting a check,” said Jeffrey Brown, chief executive of Azimut Alternative Capital Partners, or AACP. “They look for people that have experience running a firm successfully.”
Part of Italian global asset manager Azimut Group in Milan, New York-based AACP is among roughly a half-dozen firms specifically looking to purchase stakes in midmarket firms across alternative asset classes that span private equity, hedge funds, real estate, private credit or infrastructure. Others include Bonaccord Capital Partners, Investcorp, Stonyrock Partners and RidgeLake Partners.
Unlike at the larger end of the market, where many firms have already sold minority stakes, the universe of firms managing less than $5 billion in assets is still relatively underpenetrated, according to Wylie Fernyhough, a senior private-equity analyst at data provider PitchBook Data Inc.
“The supply-demand dynamics are much better in the middle market,” Mr. Fernyhough said. “Say there are 1,000 firms in the midmarket. Only about 9% of them have sold a stake.”