What is a GP-led secondary transaction?

A GP-led secondary transaction refers to a situation in which a general partner (GP) sells a portion of a fund's assets to facilitate liquidity for investors or to restructure the fund's portfolio. This type of transaction is typically initiated by the GP and serves multiple purposes, such as providing liquidity to limited partners who wish to exit their investment without winding down the entire fund or helping to reposition the fund's assets to align with new strategies or market conditions.

In the context of private equity and other investment funds, these transactions can be critical for both GPs and limited partners (LPs), encouraging ongoing investment and management while allowing some LPs to manage their capital exposure effectively.

The other options, while related to the fund management space, do not align with the specific definition of a GP-led secondary transaction. For example, simply starting a new fund or dissolving a fund does not involve the specific dynamics of secondary transactions where existing assets are being sold and liquidity events are taking place.