- $14 bln pension commits $35 mln to three funds
- Oaktree commitment divided across two vehicles
- Firm will invest Fund X first, then Fund Xb
The $14 billion retirement system committed $25 million to two funds managed by Oaktree, allocating $7.5 million to OCM Opportunities Fund X and $17.5 million to OCM Opportunities Fund Xb, according to pension documents.
Oaktree plans to invest the smaller of its latest distressed debt vehicles first. As soon as the market for distressed investment improves, or when the $3 billion Fund X is 80 percent invested, Oaktree will activate Fund Xb’s $7 billion pool of investments. The firm may also use Fund Xb as co-investment capital for Fund X deals, according to LACERS documents.
LACERS is a limited partner in seven existing Oaktree funds, having committed $68.1 million to the firm since 1995. Those funds netted internal rates of return ranging between 8.1 percent and 28.6 percent according to pension documents.
The retirement system also committed $10 million to Thoma Bravo Special Opportunities Fund II. The fund will invest alongside Thoma Bravo’s $3.7 billion flagship fund, acquiring stakes in software and technology driven services companies, according to retirement system documents.
Thoma Bravo closed the special opportunities fund at its $1.07 billion hard cap earlier this year, according to a press release.
LACERS had a 9.3 percent allocation to private equity as of Dec. 31, roughly 3 percentage points short of its target, according to retirement system documents. Earlier this year, the retirement system approved an investment plan that calls for making between $325 million and $350 million of new commitments this year. Much of the money will go to small and middle-market funds.