Finnish Pension Insurer Targets 4% PE Allocation

Finnish pension insurer Ilmarinen is increasing its commitment to private equity with the aim of reaching a 4 percent target allocation by 2015.

The insurer’s focus remains European buyouts funds, but Ilmarinen will also gain exposure to U.S. buyouts funds through commitment to global buyout funds. In addition, Asia will be a new area of focus for the group. The team will also consider committing to mezzanine, distressed and secondary funds. The insurer’s actual allocation stands at 2 percent, representing around €556.4 million ($746 million) of total assets of €26 billion.

Ilmarinen has been investing in private equity for 15 years and an in-house team has been in place since 2000; three professionals are dedicated to private equity within an overall team of five covering private equity, hedge funds, real estate and infrastructure. Mikko Räsänen is head of private equity for the group, responsible for private equity, indirect real estate and hedge fund investments. He joined Ilmarinen in 1998 when the investment platform of Ilmarinen was established. Räsänen has more than 14 years of investment experience with advisory board memberships in 17 private equity real estate funds.

Ilmarinen’s goal is to safeguard the pensions promised to Finnish employees by managing investment assets. To date, Ilmarinen is responsible for the pension provision of a total of 800,000 persons. About 36,000 companies have insured their employees with Ilmarinen which includes a total of insured 470,000 employees.