Indiana PRS commits $311 mln to PE, eyeing tech and Europe

  • Total Assets: $34.2 bln (as of June 30, 2018)
  • Private equity target: 10 pct
  • Actual allocation: 12.1 pct
  • PE return: 16 pct as of August 2018
  • Why is this important: Indiana, a steady investor in PE, targets tech and Europe in recent months

Indiana Public Retirement System’s board in the past five months approved more than $311 million in private equity commitments, including new investments in a tech-sector fund and European markets, the system said at its February meeting.

The system has been steadily growing its private-markets portfolio, to around 12.2 percent of the total portfolio. Indiana had about $3.4 billion invested in private markets, up from about $3.3 billion in 2017.

Recent commitments included:

  • $15 million in Moda Midstream’s EFM Moda Holdings LP, a liquids terminal and logistics company;
  • $85 million in Sumeru Equity Partners Fund III, a technology-focused buyout fund in North America, targeting $600 million, according to a Form D filing on Nov. 3;
  • $21.3 million to a co-investment vehicle that will invest alongside Sumeru Equity Fund III;
  • $90 million in Crescent European Specialty Lending II, and
  • $100 million to two TPG TSSP Adjacent Opportunities Partners funds, including $75 million to a pool that will activate only if the market turns down.

Indiana’s PE portfolio returned 16 percent, beating its custom benchmark by 0.4 percent, as of August 2018, according to the annual report.

The system had a target allocation to private markets of 14 percent, with a range of 10 to 18 percent as of June 30, 2018, the report said.

Within the private-markets allocation, the system was targeting 10 percent for PE, with an actual allocation of 12.1 percent as of June 30, 2018, the annual report shows.

Co-invests were the star performer for the system since inception as of June 30, generating an internal rate of return of 26.6 percent, the annual report said.