Firms & Funds

CalPERS inks $255 mln for funds, co-investments in August

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CalPERS
Anne Stausboll, CEO of the California Public Employees' Retirement System (CalPERS), speaks during the Women in Finance Symposium at the Treasury Department in Washington, July 12, 2011. REUTERS/Jonathan Ernst
  • $295.6 bln pension furthers relationship with Blackstone
  • Commits $76 million to First Eagle co-investment vehicle
  • Also commits to Clearlake, Stone Point, PAGAC

The California Public Employees’ Retirement System committed more than $255 million to private equity funds and co-investments during the month of August, according to an investment summary released by the pension.

The $295.6 billion pension’s largest commitment ($76 million) went to aBlackstone Group co-investment vehicle called Blackstone First Eagle Co-Invest LP, according to pension documents. In July, Blackstone and Corsair Capital agreed to acquire mutual fund manager First Eagle Investment Management in a $4 billion deal, Reuters reported.

Blackstone has emerged as one of CalPERS’ most favored general partners as the pension moves forward with plans to cull its active relationships with private equity managers from around 100 to around 30. Fewer relationships and larger commitments will likely lead to economies of scale for the pension, which has been attempting to reduce its fee burden for several years.

Year-to-date, CalPERS has committed more than $1 billion to separate accounts, co-investments and funds managed by Blackstone, according to retirement system documents.

In addition to its co-investment with Blackstone, CalPERS allocated a combined $56 million to a pair of funds managed by Clearlake Capital Group. Clearlake, a buyout and special situations firm, recently closed its fourth flagship fund on $1.38 billion, Buyouts reported.

Clearlake also is raising a $500 million sidecar vehicle, called Clearlake Opportunities Partners, for non-control investments. CalPERS committed to both funds.

CalPERS committed $63 million to a co-investment vehicle managed by Stone Point Capital, a $13 billion private equity firm whose family of Trident Funds acquire financial services companies. The retirement system previously committed $250 million to Stone Point’s last flagship fund, which closed on $4.5 billion last year.

CalPERS also committed $60 million to PAGAC Drone Holdings I, a PAG Asia Capital vehicle used to acquire property services business DTZ last year, according to a Polish regulatory filing.

CalPERS had a 9.6 percent allocation to private equity as of March 31, just short of its 10 percent target for the asset class, according to its website. The pension valued its private equity portfolio at $28.9 billion.

Action Item: See CalPERS October 19 investment committee meeting here:http://bit.ly/1hNFkId