What Is A Divestment Period in Private Equity?

Ropa Ushe
July 4, 2025

Subsequent to the investment period of a private
markets fund, the divestment period (i.e. ‘harvest-
ing period’) represents a five-year time frame (it is
ten for fund of funds and sometimes more for some
private real asset funds) during which a fund devel-
ops and sells or lists its investments. At the end of
the divestment period, the fund should have sold
all its holdings and be free of any warranties. If not,
the fund manager has the choice to sell the assets
on the secondary market (direct secondaries) or to
other investors, transfer these assets to a new fund
(a GP-led restructuring), or extend the lifespan of
the fund beyond the initial plan. The divestment
period can then be extended by one-to-three years if
this is allowed by the fund regulations.

Ropa Ushe

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