Edison review on HarbourVest Global Private Equity

London, UK, 19 June 2020

Edison review on HarbourVest Global Private Equity (HVPE/HVPD)

HarbourVest Global Private Equity (HVPE) posted an NAV decrease of 0.7% between July 2019 (last interim results) and May 2020, largely due to the COVID-19 induced market downturn in March (ytd NAV performance since end-2019 was a 4.8% decline). Although increased capital calls left HVPE with a historically low coverage ratio, we perceive HVPE's liquidity (supported by its US$600m credit facility) as sufficient to cover near-term commitments. HVPE withstood the 2008 global financial crisis (GFC) well compared to the broad public market and enters the current turmoil with high exposure to resilient sectors such as tech and software and healthcare. 

HVPE's discount of 25.4% to the company-estimated end-May NAV compares to its five-year average of 20.7%. The wider discount is a common feature among PE investment companies given the macro uncertainty. That said, HVPE's NAV is largely based on end-March valuations and therefore mostly captures the drop in market multiples.

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