In a year defined by delayed exits, illiquid markets, and tighter investor cash flow, general partner (GP) led secondaries have emerged as one of the most talked-about tools in private capital. Once seen as a niche mechanism for legacy fund restructuring, they have now entered the mainstream.
In the first half of 2025 alone, the global secondaries transaction volume reached a record $102 billion. Crucially, over 40% of that figure came from GP-led deals—a sharp rise compared to pre-2020 levels—reflecting how deeply the model is now embedded in the private equity ecosystem.
These transactions offer flexibility but raise complex legal, regulatory and commercial questions, especially as the line between buyer and seller becomes blurred.
GP-led secondaries involve a general partner (GP) transferring assets from an older fund into a newly created vehicle. That vehicle is usually backed by existing limited partners (LPs) who “roll over” and new investors who buy into the deal. The GP continues to manage the assets.
This structure allows GPs to extend their hold period on strong-performing assets while giving liquidity to LPs. But with GPs managing both the old and new funds, concerns are growing around valuations, fairness and fiduciary obligations.
Drivers include GPs seeking to retain growing assets and extend fee potential, and LPs needing liquidity amid limited exit routes. Valuation conflicts are key: GPs are on both sides of the deal, often relying on internal models with no public benchmarks.
In the USA, the SEC’s 2025 rules now require disclosures and LP consent. In the UK, fiduciary duties apply under common law, with no equivalent statutory framework. Disclosure standards vary, and LPs may face information asymmetry.
Despite growing deal volume, LPs are cautious—92% chose to cash out in 2025. GP-led deals are harder to close and require careful structuring. Legal clarity and oversight will be increasingly essential.
Written by: Oliwia Jakobczak
Sources: FT, Bloomberg, PitchBook, Latham & Watkins LLP, Proskauer, ILPA, SEC.gov, Harvard Law School Forum on Corporate Governance
GP-Led Secondaries: Reshaping Liquidity in Private Capital
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