LifeSight to back private equity LTAF launch
The LifeSight master trust is to invest up to 5% of its default option into a new private equity-focused long-term asset fund (LTAF) soon to be launched by WTW.
LifeSight, which manages £17bn on behalf of 360,000 members, will be a cornerstone investor for the CG WTW Private Equity Access LTAF, which is slated for launch later this year, pending approval from the Financial Conduct Authority (FCA).
The new fund will target various private equity opportunities, including co-investments, using the LTAF structure, which itself has been designed to improve access to illiquid assets for investors such as defined contribution (DC) pension schemes.
LifeSight’s planned allocation is part of initial commitments worth more than £450m to the CG WTW Private Equity Access LTAF. The exact size of LifeSight’s commitment was not disclosed.
The launch marks the first time WTW has offered a pooled private equity fund to the wider institutional market, according to a press release. Subject to regulatory approval, the fund is expected to launch in the second half of 2024.
The fund is managed by Carne Global and incorporates mechanisms to ensure that the fund’s valuation aligns to the net asset value of underlying assets in the portfolio. It will also ensure that liquidity aligns with the timing of redemptions.
WTW said its processes would include a third-party valuer “adopting market best practise for investors into evergreen, semi-liquid funds investing into private markets”.
Jelena Croad, head of LifeSight UK, said: “LifeSight is committed to offering increasing value for members. Including private equity in the existing LifeSight default is expected to improve member outcomes and we are extremely proud to be able to offer this to members within our existing fee structure.”
Simon Ellis, chair of trustees for LifeSight said the trustee board had “completed a lengthy and thorough governance process to ensure the suitability of the fund and its alignment with the trustees’ commitment to member outcomes”.
Since the first LTAF was authorised by the FCA last year, several DC schemes have used them to access illiquid asset classes such as private equity. The Cushon Master Trust invests in Schroders’ ClimatePlus LTAF, while HSBC’s DC scheme recently became the first single trust scheme to invest in an LTAF, backing the launch of a fund run by Fulcrum Asset Management.
Further reading
HSBC adds private markets to DC scheme (19 March 2024)
Aviva converts climate strategy to LTAF (20 March 2024)
Mindset shift key to private markets in DC, trustees told (26 May 2022)