The US Securities and Exchange Commission is turning its attention to the potential for misconduct in a private equity product that’s become popular with asset managers struggling to sell their investments, a person familiar with the matter said.
The probe focuses on so-called continuation vehicles, said the person, who asked not to be identified discussing internal agency matters. The person didn’t name which firms or funds were part of the probe. Reuters first reported the investigation.
Continuation funds allow a private equity firm to transfer one or more companies from an existing fund to a newly created fund. Such transactions have been around for more than a decade but surged in recent years as private equity firms have faced a dealmaking drought.
Source: SEC Probes Popular Private Equity Asset-Shuffling Technique – Bloomberg