LP corner, week of Aug. 9, 2010

Ohio Police & Fire still has capacity this year

The $10 billion Ohio Police & Fire Pension Fund still has more than $300 million it can commit to private equity this year, as it climbs toward its target allocation to the asset class of 7% from its current level of 3.6 percent.

The limited partner’s private market investment plan for 2010 permits up to $350 million in commitments to private equity, but it has made only one pledge so far this year. Francisco Partners’ third fund, earmarked for investments in the communications, hardware, information technology services and software sectors, recently received $15 million from the LP, leaving up to $335 million available for commitments for the rest of the year, says Dave Graham, a spokesman for the fund.

Attractive areas for the pension fund in 2010 include buyouts, venture capital and secondary partnerships. Both U.S. and non-U.S. primaries and secondaries are of interest, but non-U.S. opportunities will only be accessed via funds of funds, Graham says.

Last year, on the international front, Ohio Police & Fire Pension Fund pledged $35 million to the Adams Street Partnership 2009 Global Offerings Fund – Non-U.S. Fund Program and €43 million ($55 million) to HarbourVest International Private Equity Partners VI.

Past commitments have also gone to Blue Point Capital Partners, a mid-market specialist with an Asian strategy; secondary firm Montauk TriGuard Management; Park Street Capital, a funds-of-funds manager; and Primus Capital Partners, which invests in business services, health care and education.

Most pledges are slugs of $5 million or $10 million. —Nancy Gordon

Ohio LP to maintain PE pace over next year

The School Employees Retirement System of Ohio intends to maintain the same goal of pledging $150 million to $250 million to private equity in its new fiscal year as it did in the prior year, as the pension nears its target allocation to the asset class. The limited partner may also explore hiring a separate account manager for secondary and co-investment mandates.

Expect the pension fund’s commitments in fiscal 2011, which began on July 1, to go mostly to buyout funds. However, the staff will also continue to consider international and special situation funds, such as energy, secondary and distressed debt vehicles, as well as co-investment opportunities.

The private equity portfolio is currently divided about two-thirds buyouts, and one-third venture capital and special situations.

Through March, the LP had reviewed more than 110 partnerships and had held more than 40 preliminary discussions with general partners. But the pension fund’s commitment pace was nevertheless slower than anticipated over the past year “due to a smaller number of high caliber investment opportunities” in the market, according to a board document.

Through March, said spokesperson Tim Barbour, the LP had committed $120 million during the fiscal year to three funds: up to $40 million each to Francisco Partners III, a technology-focused mid-market buyout fund, and Mason Wells Buyout Fund III, a lower mid-market buyout vehicle; and up to $40 million to Monomoy Capital Partners II, earmarked for corporate restructuring investments. —Nancy Gordon