Once used to sell off zombie funds or badly underperforming assets, a growing number of continuation funds are being launched around high-performing trophy assets that aren’t currently fetching their proper valuation. Unsurprisingly, while GPs applaud the strategy, LPs are more reserved due to potential conflicts. “It’s perfectly natural for LPs to be skeptical of a transaction between affiliated parties as it inherently carries with it the potential for conflicts,” says co-chair of the Secondaries practice, Robert Emerson, to Mergers & Acquisitions. But as these vehicles mature, LPs’ concerns are being addressed. It’s now commonplace for LPs to obtain fairness opinions and most deals now include “status quo” clauses that guarantee LPs can roll over into the new vehicle with the same fees and carry.