LACERS commits to Vista V, Energy Capital

  • LACERS commits $40 million to Vista Equity Partners V
  • Pension pledges $40 million to Energy Capital Partners III LP
  • LACERS ups commitment to Energy Capital by fund series by $15 million

The LACERS pledge to the latest flagship fund from Vista Equity Partners brings its total to more than $100 million with the tech-focused buyout firm.

LACERS committed a total of $55 million for both the 2007 vintage Vista Equity Fund III LP and the 2011 vintage Vista Equity Fund IV LP as well as a separate $10 million to the 2013 vintage Vista Foundation Fund II LP, aimed at the lower middle market. Fund III has earned LACERS an internal rate of return of 40.4 percent as of June 30, 2013, while Fund IV’s IRR is 15.4 percent. The pension approved the Vista commitment at its April 8 meeting.

Vista Equity plans to raise $3.5 billion for Fund V, with plans to add eight to 10 portfolio companies with equity investments of at least $100 million per transaction, according to a memo from Hamilton Lane, the pension system’s private equity consultant.

Meanwhile, LACERS increased its commitment to Energy Capital Partners to $40 million for Energy Capital Partners III from $25 million pledged to Energy Capital Partners II LP, the firm’s 2009 vintage fund that earned an IRR of 21.2 percent as of June 30, 2013.

Energy Capital Partners employs a buy-and-build strategy within U.S. energy-related sectors that begins by purchasing existing companies or creating startups, according to a memo from Hamilton Lane. The firm plans to build a diversified portfolio of 10 to 20 companies through the new fund, with equity investments ranging from $100 million to $500 million.

Energy Capital Partners announced a final close of Energy Capital III on April 8 at $5 billion, above its $3.5 billion target. LACERS approved its commitment to the fund at its Feb. 25 meeting.