has resigned as state investment officer of
Earlier this year, the state LP cut ties with Aldus Equity over its involvement in the alleged kickback scandal when the Securities and Exchange Commission filed charges against the PE consultant and Meyer. This month, Meyer pleaded to fraud involving securities transactions in New York and New Mexico. Meyer became the fourth person to plead guilty as part of the scandal, which continues to be investigated by state and federal officials.
In May, the state moved to ban investments with money managers who use third-party placement agents. The limited partner also now requires disclosure of all payments made in relation to its investments.
Meyer issued a statement earlier this month: “Contrary to my fiduciary duty, I ensured that Aldus recommended certain proposed investments that were pushed on me by politically connected individuals in New Mexico. I did this knowing that these politically connected individuals or their associates stood to benefit financially or politically from the investments and that the investments were not necessarily in the best economic interest of New Mexico.”
In addition to Aldus Equity, New Mexico has ties to Searle & Co., the advisory firm of indicted placement agent Henry Morris. Quadrangle Group and The
Bland has given no official reason for his resignation. The Associated Press reported that Bland preempted the likely decision by the board of the Investment Council, which was planning to ask for Bland’s resignation at a meeting last week. New Mexico Gov. Bill Richardson issued a statement that said the process to name a successor to run the State Investment Office has launched. —Erin Griffith
OMERS gets direct with PE
Don’t bother pitching alternative investment funds to the
Instead, the $41 billion system’s 40% allocation to “private markets” will be used for direct investments in private equity, venture capital, infrastructure and real estate transactions.
This strategy shift has been whispered for months, given that OMERS hasn’t made a new fund commitment since 2007. But it was not explicitly stated until last week when it was confirmed by both OMERS CEO Michael Nobrega and OMERS Strategic Investments CEO Jacques Demers.
Demers explained that OMERS believes it leaves too much money on the table when investing in outside funds, due to the fees and carried interest that get siphoned off the top. He acknowledged that a direct program has its own overhead, but that the benefits far outweigh the costs.
About 90% of OMERS’ current private markets portfolio now consists of direct investments, with the other 10% representing legacy LP commitments that it will wind down over time. OMERS does not have plans to sell those fund positions on the secondary market.
In the past, OMERS has committed to funds from such firms as Asia Alternatives Management, Baring Private Equity, Celtic House Venture Partners, Dolphin Equity Partners, TowerBrook Capital Partners, West Hill Partners and TPG Capital.
Demers joined OMERS in January with the mandate of creating a portfolio of companies that would help the system improve its deal flow. He previously was a senior partner with Ogilvy Renault in Toronto. —Dan Primack and Erin Griffith