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LP Scorecard: Highs and lows of Mass PRIM’s mega buyout crop

Fund IX, which posted an IRR of 48.23 percent for the period, comes top of a selection of 27 mega buyout funds of vintage 2000 and younger within the pension fund’s private equity portfolio.

In total, Massachusetts PRIM is invested in some 40 mega buyout funds and has been investing in private equity since 1978.

Not doing so impressively at the bottom of selection (although still in positive figures) is the 2006 vintage TPG Partners V with an IRR of 0.12 percent for the period.

Both First Reserve and Hellman & Friedman feature twice in the top five mega buyout vehicles in this scorecard. Blackstone Capital Partners IV 2003 vintage comes in second place with a 37.24 percent IRR for the period, followed by the 2000 vintage Hellman & Friedman Capital Partners IV fund in third place with a 34.94 percent IRR.

Second from last of this selection is the 2005 Providence Equity Partners V fund with an IRR of 3.36 percent, and following that is the 2006 vintage Blackstone Capital Partners V with a 3.66 percent IRR.

A recent report from the Private Equity Growth Capital Council ranked Massachusetts PRIM in first place among public pension funds with the best combined five- and ten-year annualized private equity returns. The $42 billion Los Angeles County Employees’ Retirement Association came in second place, followed by the $115.9 billion Teacher Retirement System of Texas.

Buyouts reported in September that Massachusetts PRIM manages one of the best-performing private equity portfolios, according to an analysis of 14 of the largest institutional investors in the Buyouts returns database.

The pension fund manages about $54 billion in total, and as of year-end had generated a 4.2 percent bottom-quartile net IRR, 11.2 percent median net IRR and 20.0 percent top-quartile net IRR on its private equity portfolio, which includes both buyout and venture capital funds. For buyout funds, the portfolio generated bottom-quartile net IRR of 7.0 percent, median net IRR of 13.4 percent and top-quartile net IRR of 22.9 percent, according to Buyouts’ database.

The board has 11.3 percent of its assets invested in private equity and reports its private equity portfolio as a whole, generating a return of 14.08 percent since inception gross of fees as of July 31.