• Private equity allocation: 13 pct of the portfolio/$1.3 bln
• Whom to contact: Christian Palmer (email@example.com)
• Why this is important: Arizona PSPRS continues to commit to middle-market PE funds
Arizona Public Safety Personnel Retirement System is mulling a $45 million re-up to Castle Creek Capital’s seventh fund.
The pension system also finalized a $40 million direct commitment and a $20 million co-investment reserve to Littlejohn & Co’s sixth fund.
In addition, it committed $50 million and a $20 million co-investment reserve to Vivo Capital’s ninth fund in July/August, its September meeting documents said.
Arizona PSPRS’s unique PE strategy centers on reserving co-investment allocations when making fund commitments, Mark Steed, the new chief investment officer, told Buyouts in an earlier article.
“The reserve allocation gives us the ability to manage risk, leverage the fee load and manage our asset allocation in the portfolio,” Steed said.
Arizona PSPRS had made $250 million in hard commitments and $95 million in co-investments in its private equity portfolio in 2018 to date, Christian Palmer, spokesperson for the pension system, told Buyouts.
Previously Arizona PSPRS committed $30 million to Castle Creek’s sixth fund, which targeted $280.9 million and had raised $267.1 million as of June 8, 2017, PE Hub said.
Castle Creek’s seventh fund raised $91.6 million from 11 investors as of July 25, Form D said.
Castle Creek, the Santa Fe-based middle-market PE firm, invests in community banks.
The firm’s sixth-fund investments include Liberty National Bank, International Bank, Trinity Capital Corp and Riverview Financial Corp. Its sixth fund investment Horry County State Bank was acquired by United Community Banks effective August 2017 for an undisclosed amount.
John Eggemeyer founded Capital Creek in 1990. The firm has invested in more than 65 bank investments including buyouts, growth and recapitalization strategies.
Littlejohn is a middle-market PE firm and invests in strategies across the capital structure. The firm invests up to $250 million in North American companies with annual revenue between $100 million and $800 million.
It is unclear how much Littlejohn’s sixth fund is targeting, but its Fund V closed at $2 billion in 2015. Portfolio companies include Alphabroder, Interior Specialists, Stallion, Strategic Materials and Total Safety.
Ohio Police & Fire Pension Fund committed $30 million and Virginia Retirement System committed $200 million to Littlejohn’s sixth fund.
Vivo Capital, formerly BioAsia Investments, is a healthcare/biotech venture firm based in Palo Alto and China.
It is unclear how much Vivo’s ninth fund is targeting, but its eighth fund closed at $750 million.
Vivo is investing out of its eighth fund. Its portfolio includes Aclaris Therapeutics, Biohaven Pharma, Kadmon and Menlo Therapeutics.
University of Houston committed $5 billion to Vivo’s ninth fund.
Arizona PSPRS’s private equity portfolio returned 15.88 percent over one year, 13.89 percent over three years, 16.67 percent over five years and 13.19 percent over 10 years as of July 31, 2018.
Action Item: Read more on Arizona PSPRS’s investments here: https://bit.ly/2rQcf6S