The Astrea Platform

Background

Temasek and its investment vehicles (the “Temasek Entities”) have been investing in PE Funds for over two decades and continue to be active investors in PE Funds globally. PE Funds, as an asset class, have created value for the Temasek Entities in the form of direct returns, as well as opportunities to make further direct investments alongside the GPs of PE Funds.

Prior to 2016, certain Temasek Entities launched Astrea I and Astrea II respectively, each of them involving investment products based on portfolios of PE Funds. In 2016, Azalea (through its wholly-owned subsidiary) launched the Astrea III transaction. The Astrea III transaction introduced the first listed notes in Singapore backed by cash flows from PE Funds.

Astrea I (2006):

  • Securitisation of a diversified and balanced portfolio of 46 high quality PE funds sourced from the Temasek Entities
  • Two classes of unrated securities and two classes of rated securities were issued and offered to institutional investors
  • The rated securities maintained their credit ratings throughout their tenure and were fully repaid in 2011
  • Intended as the first of a series of products based on diversified portfolios of PE funds

Astrea II (2014):

  • Well-diversified portfolio of 36 high quality PE funds sourced from the Temasek Entities
  • Offered to institutional investors, including sovereign wealth funds, pension funds, insurance companies and endowment funds

Astrea III (2016):

  • US$510 million of asset-backed securities
  • Three classes of rated notes and one class of unrated note were issued and offered to institutional and accredited investors in Singapore and abroad, with the exception of the United States
  • At issuance, the notes were rated as follows:
    Class Fitch Ratings S&P Ratings
    A-1 Notes Asf A (sf)
    A-2 Notes Asf Not rated
    B Notes BBBsf Not rated
    C Notes Not rated Not rated
  • The credit rating of the Class A-1 Notes of the Astrea III transaction was upgraded to A+sf and A+ (sf) about a year after issuance, by Fitch and S&P respectively 
  • The credit ratings of the Class A-2 and Class B Notes of the Astrea III transaction were upgraded to A+sf about two years after issuance by Fitch.
  • Assets comprised a portfolio of 34 PE Funds with a net asset value of US$1,141.6 million at launch. The PE Funds were managed by 26 GPs focusing on buyout and growth equity strategies

Astrea IV (2018):

  • US$501 million of asset-backed securities
  • Three classes of rated bonds were issued and offered to institutional and accredited investors in Singapore and abroad, with the exception of the United States
  • At issuance, the bonds were rated as follows:
    Class Fitch Ratings S&P Ratings
    A-1 Bonds Asf A (sf)
    A-2 Bonds Asf Not rated
    B Bonds BBBsf Not rated
  • Class A-1 Bonds are the first listed retail private equity bonds and can be traded on SGX-ST
  • Assets comprised a portfolio of 36 PE Funds with a net asset value of US$1,098.4 million at launch. The PE Funds were managed by 27 GPs focusing on a buyout strategy with almost all of the remainder employing a growth equity strategy
  • The credit rating of the Class A-1 Bonds of the Astrea IV transaction was upgraded to A+sf  about a year after issuance by Fitch.

Astrea V (2019):

  • US$600 million of asset-backed securities
  • Three classes of rated bonds were issued and offered to institutional and accredited investors in Singapore and abroad, with the exception of the United States
  • At issuance, the bonds were rated as follows:
  • Class Fitch Ratings S&P Ratings
    A-1 Bonds Asf A+ (sf)
    A-2 Bonds Asf Not rated
    B Bonds BBBsf Not rated
  • Class A-1 Bonds are listed retail private equity bonds and can be traded on SGX-ST
  • Assets comprised a portfolio of 38 PE Funds with a net asset value of US$1,324.4 million at launch. The PE Funds were managed by 32 GPs focusing on a buyout strategy with the remainder employing a growth equity strategy

 

Azalea was established to undertake the development of the Astrea Platform with the launch of Astrea III. It is focused on the development and innovation of new investment products to broaden investor access to private equity. It invests in suitable private equity funds and package them into diversified portfolios that will suit the investment objectives and risk tolerance of the targeted investors.

As an indirect wholly-owned subsidiary of Temasek, it is an operating company with a board and management independent of Temasek. In 2018, Azalea launched Astrea IV, a landmark transaction in the journey toward providing access to private equity-based investments for retail investors. In 2019, Azalea launched Astrea V, a continuing step to bring retail investors in Singapore closer to private equity through listed retail PE bonds.