- CalPERS pledges to Greenwich, Conn firm
- Pension system tweaks private equity allocation to match actual holdings
- Trident VI fund in market after predecessor drew $3.5 Bln
The California Public Employees Retirement System committed $250 million to Stone Point Capital’s Trident VI fund, as the largest public pension system in the U.S. brought its allocation to private equity in line with its actual holding of 12 percent.
The $284 billion pension system’s pledge to Trident VI LP marked its only move into private equity for the month ended Dec. 31, according to documents posted recently on the pension system’s website. The transaction was completed under staff authority, with an initial funding date of the partnership set at Dec. 13.
A fundraising target for Stone Point Capital’s Trident VI wasn’t available from CalPERS, but the firm raised $3.5 billion for the vintage 2010 Trident Fund V LP, according to a public filing.
Past LPs for Stone Point include Canada Pension Plan Investment Board, Colonial Williamsburg Foundation, Conversus Capital and the Florida State Board of Administration, according to the Thomson One private equity database.
Stone Point Capital focuses on the global financial services industry, with leadership from Charles Davis, Stephen Friedman, Meryl Hartzband, James Carey, David Wermuth and Nicolas Zerbib.
”We generally target equity investments of between $50 million and $350 million, but have the ability to make significantly larger investments,” the firm said on its website. ”We typically seek control or substantial minority positions in our portfolio companies, with board representation and customary shareholder rights.”
Separately, CalPERS pared back its allocation target for private equity to 12 percent from 14 percent, but the change won’t have a big impact on its portfolio since its actual allocation level stands at 12 percent for the asset class. Private equity ranks as the third-largest portion of its portfolio out of seven total asset classes.
Overall, CalPERS went with the most conservative of three portfolio scenarios. It’ll cut its exposure to equities to 47 percent from the target of 50 percent and hike global fixed income to 19 percent of its portfolio from the target of 17 percent.
In other moves, the pension system plans to hike its real estate portfolio allocation to 11 percent from a target of 9 percent.
Its expected compounded return for one-to-ten years was reduced to 7.15 percent from a target of 7.25 percent, with expected volatility now at 11.76 percent, down from a target of 12.45 percent.