Sep. 13, 2012
Thomas Wuchenich
See more on Thomas WuchenichSimpson Thacher & Bartlett LLP Los Angeles Corporate Specialty: asset management, fund formation, private equity, securities
Limited partnerships have been gaining more leverage in their negotiations with the sponsors of private investment funds, said Wuchenich, who represents asset management firms in the formation and operation of their private equity funds. "There are a lot of sponsors out there trying to raise money, and limited partners have the ability to be more selective."
He noted the pendulum has swung the other way in the limited partners' favor.
"If you go back several years, firms were raising mega funds and everyone was clamoring to get into them," Wuchenich said. "That has shifted. Limited partners have decided not to cast a wide net when selecting partners and instead to focus on key relationships."
Meanwhile, it's been slow going.
"We have a lot of clients out raising money," he said. "It's a tough fundraising market, deals are taking a lot longer to put together and partners have more leverage and are getting more organized."
But it's important for all of the parties to understand that the deals they are entering into ideally should lead to relationships that will last for years, Wuchenich said, adding, "This is not a one-time negotiation."
Wuchenich also said that he is seeing more focus on making sure that the general partners' interests are aligned with the investors.
"They want better transparency and information from the [general partners] on what is going on," he said. "They don't want any surprises."
Among Wuchenich's significant matters, he represented Oaktree Capital Group LLC in its initial public offering of 8.8 million units representing limited liability company interests. Oaktree is a Los Angeles-based investment management firm with roughly $75 billion in assets. Goldman Sachs & Co. and Morgan Stanley & Co. Inc. were the joint global coordinators for the $380 million offering.
His other clients include private equity firms Hellman & Friedman LLC, KSL Capital Partners LLC, Platinum Equity LLC, Technology Crossover Ventures LP, Siris Capital Group and ZelnickMedia Corp.
- PAT BRODERICK
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