Swiss bank Pictet Group expects to ramp up its alternative investments tracking growth in the health, technology, and environment sectors.
Pictet Alternative Advisors (PAA), a wholly-owned unit of the bank, is set to launch its third thematic fund, focusing on investments in environment-related businesses, its top executives told DealStreetAsia.
It would follow two thematic vehicles – on technology and health – that the bank has launched in the last two years.
The tech-focused fund, which closed at $350 million in September last year, is already about two-thirds allocated across Asia, the US, and Europe. In January, PAA launched the health-focused fund, which will have a hard cap of $400 million.
“The bank wanted to offer a differentiated solution for clients. It started off with technology and innovation, because of the very strong secular trends and developments that we see in the space,” said Goh Hui Yang, senior alternative investment advisor, Alternative Investments Asia at Pictet Wealth Management.
“Because a lot of companies are staying private for longer, and a lot of value-creation is now happening in the private world, rather than the traditional public markets, how can we find more ways to access the private markets?”
Pictet first started investments in private equity in 1989. In 2008, it launched a fund-of-funds strategy – the flagship Monte Rosa franchise that invests globally across strategies. Pictet is set to close its sixth Monte Rosa fund at over $1 billion in commitments at the end of next month.
“In the thematic [funds], we’ve used the same template as the Monte Rosa, [with] three vintages,” said Gregoire De Rham, head of Alternative Investments Asia. “But the key difference here is that the proportion of co-investment is expected to be larger.”
The proportion of co-investments in the thematic funds is expected to go up to 40%, compared to between 10% and 15% in the Monte Rosa funds.
The ability to take on more co-investments, and be comfortable with it, comes with established relationships with managers, Goh added.
“We know their style of investment, risk appetite, philosophy, and portfolio management. It gives us comfort to say, yes I want to double down on this deal if there’s capacity. Over time we develop capabilities and we double down when there are suitable opportunities.”
The 217-year-old Geneva-based Pictet Group has some $767 billion in assets under management across wealth management, asset management, alternative investments and related services.
Edited excerpts of the interview with De Rham and Goh:-
