Swedish investment firm EQT’s £2.75 billion deal to buy British secondary market trader Coller Capital highlights the growing popularity of private equity spinoffs, experts tell Spear’s.
With $50 billion of assets under management, Coller Capital is a significant player in the secondary market. Managing €270 billion in total assets, EQT is the second-largest private equity firm in the world, behind US fund manager KKR, according to the PEI 300.
‘The opportunities ahead are compelling, from accelerating innovation in secondaries, to broadening the secondary solutions we can deliver to investors worldwide,’ said Jeremy Coller, founder and managing partner of Coller Capital.
‘Entering the secondaries space with Coller Capital represents a natural and important step in EQT’s strategic development,’ said CEO of EQT, Per Franzén. ‘Secondaries have become an increasingly important tool for clients in managing liquidity and portfolio construction, and in supporting long-term ownership of high-quality assets.’
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What are secondary markets?
Secondary markets are intrinsically linked to private equity. While private equity firms take a long-term approach, raising large funds from investors such as HNWs and pension funds to buy, improve and sell private companies for profit, secondary markets offer a shorter-term alternative. They give investors access to liquidity by allowing them to sell their assets before a private equity fund reaches its natural end.
Likewise, secondary markets give buyers access to portfolios with established assets, rather than going in blind, as is often the case with private equity, where investors buy into the firm rather than specific underlying investments.
Growing interest in secondaries funds
As the private equity market has matured and grown, so too has the need for liquidity solutions, argues UBS’ co-head of private equity, Diana Celotto.
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‘Secondaries, the buying and selling of existing private equity fund interests or direct investments, have emerged as a key mechanism for unlocking value and flexibility,’ she says. ‘More than just a liquidity solution, secondaries have become an important management tool, as they allow investors to exit positions early, meet cash needs, and rebalance or optimize portfolios.’
The secondaries market was trading volumes of around $200 billion a year by the end of 2025, significantly higher than the previous year’s $160 billion of transactions, according to Private Equity International.
The illiquidity of private equity can be a major drawback for some investors, with secondaries providing a much-needed solution for this, says Goldman Sachs asset manager Harold Hope on the investment bank’s podcast, Goldman Sachs Exchanges The Rise of Secondaries: Unlocking Liquidity in Private Markets.
‘But one of the big drawbacks is that [private equity] is very illiquid,’ he says. ‘Private equity investments can often last ten, 15 years or longer. What we’re doing in the secondaries is really providing liquidity to folks who have invested in these long dated, illiquid assets before their natural termination.’
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In the same podcast, Goldman Sachs senior analyst Alex Blostein says that while secondaries are growing in popularity because of private equity’s weaknesses, their growth has also been reliant on the expansion of primary markets.
‘In terms of the drivers and how we got here, just like any market, a secondary market is going to be a function of the primary market,’ he says. ‘Private markets and illiquid strategies have grown massively over the last decade plus. That space is compounding at 10 to 15 percent a year as well. So, it makes sense that secondaries would follow that.’
It is not a failsafe
While private equity, and in turn secondaries, offer benefits for investors such as potentially high returns and portfolio diversification, there are also pitfalls to consider.
Few private equity firms redistribute capital on schedule, according to the CFA Institute, a non-profit organisation that sets standards for investment professionals. Because secondaries are so closely tied to private equity timeframes, buyers may face longer-than-expected investment horizons. Of 200 private equity funds analysed, 85 per cent returned investors’ capital late, with some taking more than a decade to reach a profitable exit, according to research from Palico.
Another criticism raised by the CFA Institute is the opacity of private equity and secondary markets. In its paper The Economics of Private Equity: A Critical Review, it writes: ‘Private equity largely invests in private assets: not being traded in financial markets, private assets cannot be marked to market easily, and estimating their value before exit is difficult.’
The paper also notes that private equity investments often do not generate profits until the end of their life cycle, meaning that investing in secondaries is not always a foolproof strategy for making successful bets.
Why IPOs and strategic sales are falling in popularity
While private equity and secondaries focus on buying private companies, as well as privatising previously listed businesses, an initial public offering (IPO) takes a company public, allowing shares to be traded on the stock exchange.
Many private companies are now choosing not to go public, says Celotto, compared with the past when IPOs were more common.
‘Investor scrutiny, increasing complexity, regulatory requirements, and rising related costs have deterred many companies from going public or remaining listed,’ she says. ‘With private capital now more accessible than ever, some companies prefer to stay private or leave public markets to focus on long-term value creation, sometimes partnering with a private equity firm.’
Echoing the view that IPOs have become less attractive due to their lack of reliability is Srbuhi Avetisyan, an analyst at asset transfer platform Owner.One.
‘IPOs have lost their appeal because they no longer reliably deliver what founders and early investors expect: clean exits, stable pricing, and control over narrative,’ she says. ‘Public markets are less forgiving, more volatile, and more exposed to short-term sentiment.’
Avetisyan adds: ‘Many companies prefer to stay private longer, use private liquidity solutions, or explore secondaries rather than submit to the scrutiny and rigidity of public markets too early.’
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Who is Jeremy Coller?
Set to receive £1.9 billion up front from Coller Capital’s sale to EQT is the secondaries firm’s founder, Jeremy Coller.
Having founded the firm in 1990, he established Coller Capital as a pioneering investment house specialising in secondaries, an area that was then considered an obscure corner of the financial world.
Already ultra-wealthy, with a fortune of $4.9 billion according to Bloomberg, Coller is an active philanthropist who supports animal welfare and educational charities.
Coller, along with his firm’s leadership team, will continue to lead the business under its new name, Coller EQT.
