Harvard Management Company, which oversees the largest endowment in U.S. higher education, is in advanced talks to sell private equity fund interests worth approximately $1 billion. This move follows a sale process that began last year and is unrelated to President Trump's threats of funding cuts. The sale is being facilitated by Jefferies Financial Group, which is advising the university in the transaction. Lexington Partners, a private equity firm, is set to acquire the portfolio in what may be a secondary transaction. However, the terms of the deal are not yet final and remain subject to change. As of 2024, 39% of its endowment was invested in private equity, up from 34% in 2021. This suggests that the university is maintaining its long-term commitment to private equity despite the ongoing market uncertainty.
Additionally, the decision to sell comes amid unprecedented market volatility driven by U.S. tariff policies. Many investors, including those overseeing large endowments, are exploring ways to increase liquidity by selling private equity holdings. Harvard's $53 billion endowment is no exception, with the sale aimed at managing risk and enhancing flexibility in an uncertain financial environment. Harvard is not alone in exploring such options—Yale University is actively considering selling its private equity fund interests, with Evercore advising on the transaction. Both universities are responding to the developing market landscape by recalibrating their strategies, ensuring liquidity while securing their endowments' future growth.
