Idaho sees record distributions from PE in Q1

Idaho’s Public Employee Retirement System’s private equity portfolio returned $95.4 million in the first quarter, the most since the $16.9 billion public pension launched its private equity program in 1992,  according to a Hamilton Lane report presented at the retirement system’s meeting earlier this week.

The public pension’s general partners called $57.4 million for new investments during the quarter, the report said. Roughly 18 percent of Idaho’s first-quarter distributions came from its stakes in Enhanced Equity funds, which the public pension sold in February.

Enhanced Equity restructured both its funds earlier this year, which gave its older LPs the option of selling their interests in the vehicles. In February, Secondaries Investor reported Hamilton Lane and its clients represented roughly 70 percent of Enhanced Equity’s investor base.

Idaho committed $194 million across four funds through H1 2017. Flagship funds managed by Apollo Global Management, CVC Capital Partners and Veritas Capital. The retirement system also backed Silver Lake’s newest flagship fund for $44 million.

The system closed one commitment in Q3, a $40 million allocation to TPG Growth. TPG is targeting $3 billion for its newest growth equity fund.

TPG’s third growth fund, which raised $3 billion, was netting a 17.5 percent internal rate of return and 1.1x multiple through the end of the first quarter, according to a Hamilton Lane report prepared for Teachers’ Retirement System of Louisiana. Fund II, a $2 billion 2011 vintage fund, was netting a 28.1 percent IRR and 2.1x multiple as of the same date.

Idaho’s $1 billion private equity portfolio has netted an 8.2 percent return since its inception.

Action Item: For more information on Idaho’s PE program, visit www.persi.idaho.gov

The hills north of Boise, Idaho in winter. Photo Courtesy of Sam Sutton