LP Scorecard: Blackstone, Platinum Equity outperform for PSERS

The Pennsylvania Public School Employees’ Retirement System, which has nearly $52 billion in assets under management, has enjoyed especially strong performances by investments in a secondary fund from Blackstone Group and a buyout fund from Platinum Equity.

Blackstone Group’s Strategic Partners Fund VI is the top-performing fund by IRR in PSERS’ private equity portfolio as of March 31, 2015. The young secondary fund, which has started turning out distributions, has generated an IRR of 68.4 percent. It marks the fifth time PSERS has re-upped with that particular fund family.

Two Platinum Equity funds placed second and fifth by IRR. Platinum’s 2004-vintage maiden fund has nearly doubled the state’s committed capital, producing an IRR of 60 percent. The firm’s third primary fund, from 2012, has generated an IRR of 37.4 percent. The Los Angeles-based firm prides itself on bringing operational expertise to conventional mergers and acquisitions.

A pair of international funds posted the third- and fourth-highest IRRs for PSERS.

Hong Kong’s Baring Private Equity Asia, one of the largest independent PE shops on the continent, saw its third fund generate an IRR of 53.3 percent. The fund is pan-Asian and invests primarily in the middle market.

Paris-based PAI Partners represents the largest commitment ($321.8 million), contribution (about $335 million) and total distribution ($1.1 billion) of any fund on the top 10 PSERS list. PAI Europe III produced an IRR of 38.2 percent. PAI invests in leveraged buyouts in Western Europe.

All told, PSERS’ PE portfolio has $25.5 billion in committed capital across 223 active funds. Those active investments combined for a total of $22.9 billion drawn down and realized $25.9 billion in returns as of March 31, 2015.

Action Item: Download the LP Scorecard table as a spreadsheet here: http://bit.ly/1TzPoUL

LP Scorecard, Pennsylvania  Pennsylvania Public School Employees’ Retirement System, March 7, 2016 issue of Buyouts