Abrdn Private Equity Opportunities (APEO ) is ‘evaluating the impact’ to the fund and its manager after the investment firm struck a deal to sell its private equity division, however, the board also stressed that no immediate changes will be made. 

The deal to Nasdaq-listed Patria Investments comprises an upfront cash consideration of £60m followed by another £20m plus interest paid as a secured deferred consideration, two years following the completion of the deal.

A further £20m will be paid subject to the performance of the £7.5bn division, three years after completion.

Abrdn said in a statement that the sale follows a strategic review of its alternatives business. 

‘We concluded that the capital generated from the sale of certain of our private equity businesses would be better deployed within our core investment businesses,’ said the statement.

The board of the £657m APEO fund, managed by a team headed by Alan Gould, said it had ‘received assurances from Abrdn and Patria that the company’s investment management team will remain unchanged should the transaction proceed’.

Abrdn will also put ‘appropriate arrangements’ in place to ‘maintain’ administration and other services currently provided by Abrdn.

‘The board is evaluating the impact of the transaction on the company and its management team and is continuing to have constructive discussions with Patria,’ said trust chair Alan Devine.

‘No changes will be made to the company’s existing management and administration prior to the transaction completing.’

Cayman Islands-based alternative asset manager Patria is largely focused on Latin America, and has assets under management of $28.2bn (£23.2bn).

The deal is expected to complete in the first half of 2024.

The sale of Abrdn’s private equity arm had previously been mooted in February to Spanish bank Santander’s asset management arm.

Notably, at that time assets in the division were substantially larger at £14bn.

Shares in Abrdn were up 3.2% to £1.63, following the announcement, while APEO’s shares added 0.4% to trade at 429p.