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ARTICLE · 28 APRIL 2020

Private Equity Funds & Co-Investment: A Symbiotic Relationship

Broadly, a co-investment is an investment in a specific transaction made by limited partners (LPs) of a main private equity (PE) fund alongside, but not through, such main PE fund.

CanadaFinance and Banking

Broadly, a co-investment is an investment in a specific transaction made by limited partners (LPs) of a main private equity (PE) fund alongside, but not through, such main PE fund. This is often accomplished through a separately structured co-investment vehicle which is governed by a separate set of agreements. Co-investments are attractive to PE funds and LPs alike for a multitude of reasons, including as: a means for PE funds to gain access to supplementary capital; an avenue by which PE funds may make larger single investments that are otherwise unavailable or undesirable; and a means for LPs to attain enhanced diversification and a larger share of desirable investment, among others.

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