Franklin Lexington Fund Accepts All Shares Tendered in First Self-Tender Offer

Franklin Lexington Private Markets Fund accepted every share tendered in its first self-tender offer, buying back stock across all four of its share classes at net asset values ranging from $32.13 to $32.53 per share.

The fund, a registered closed-end tender-offer vehicle co-advised by Franklin Templeton and Lexington Partners, reported the results Aug. 21 in a filing with the U.S. Securities and Exchange Commission. The underlying offer ran from its May 15 launch through a June 15 expiration and covered up to 5% of the fund’s net assets, or roughly $99.99 million, as of March 31, with the fund reserving the right to accept up to 2% more without amending or extending the offer.

Investors tendered 156,125 Class S shares, 228,971 Class D shares, 717,909 Class I shares, and 389,100 Class M shares, and the fund accepted 100% of each, meaning demand for liquidity fell short of the offer’s cap and no shareholder was prorated. Shares were valued as of June 30 at $32.13 for Class S, $32.45 for Class D, $32.53 for Class I, and $32.32 for Class M.

The full acceptance is an early data point for a fund still building its redemption track record. Nontraded and tender-offer vehicles routinely draw scrutiny over whether their periodic liquidity windows can absorb shareholder demand without prorating requests; a first tender that clears without hitting the cap suggests redemption pressure has stayed modest so far.

A Secondaries Fund Built for the Wealth Channel

Franklin Templeton and Lexington Partners launched Franklin Lexington Private Markets Fund on Jan. 2, 2025, billing it as the first registered tender-offer private equity secondaries fund built for the U.S. wealth channel. The fund pursues a dual strategy, acquiring private equity stakes on the secondary market while also co-investing alongside sponsors raising new private equity funds, an approach Franklin Templeton describes as giving wealth-channel investors diversified exposure across general partners, vintages, geographies, and industries without the capital calls of a traditional drawdown structure.

The fund launched with roughly $904.5 million in assets through partnerships with two U.S. wealth management firms and has grown to $2.13 billion in net assets as of the June 30 valuation date used in this tender, more than doubling in size since inception. That growth has tracked a broader buildout at Franklin Templeton: the firm’s related Franklin Lexington private equity secondaries strategy, which spans this fund along with vehicles offered outside the U.S. since expanding to international investors in March 2025, surpassed $3.5 billion in combined assets under management within its first year, the firm said in February.

Lexington Partners sub-advises the fund and manages more than $76 billion in capital across more than 1,000 secondary transactions and more than 5,000 fund interests over three decades. Wil Warren, a partner and president of the firm, leads the partnership. Dave Donahoo heads U.S. wealth management alternatives for Franklin Templeton, which oversees roughly $1.68 trillion in assets globally, with alternatives – including private equity, private credit, private real estate, and digital assets – making up about 16%, or $275 billion, of that total as of Jan. 31.

Terms of the Fund’s Liquidity Program

Franklin Lexington Private Markets Fund intends to offer quarterly tenders for up to 5% of net asset value, though the fund’s board can reduce, skip, or decline to conduct any given quarter’s offer, and execution is not guaranteed. Shares tendered within the first year of purchase are subject to a 2% early repurchase fee.

The fund charges a 1.25% annualized management fee on net assets and a 12.5% incentive fee subject to a 5% annual hurdle, a high-water mark and a catch-up provision; gross expense ratios by share class ranged from 4.79% for Class I to 5.64% for Class S as of the most recent published snapshot.

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