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LP Scorecard: How Special Situation Funds Are Performing For UTIMCO

AG Capital Recovery Partners IV LP comes out top, posting a 28.68 percent IRR and 1.58x multiple. UTIMCO committed $20 million to that fund.

UTIMCO’s active portfolio includes some 261 private equity funds spanning vintages 1988 to 2012. The state pension fund is invested in some 27 distressed and special situations vehicles within its active portfolio. Oaktree Capital Management is the beneficiary of eleven of these commitments to its various distressed vehicles. Four of these make the top ten, taking second, fourth, sixth and seventh place respectively. The median IRR of UTIMCO’s commitment to distressed and special situation funds is 7.99 percent and the median multiple is 1.26x; top-quartile IRR is 11.4 percent and top-quartile multiple is 1.46x; bottom-quartile IRR is 2.63 percent and bottom-quartile multiple is 1.07x.

UTIMCO’s three largest commitments to distressed and special situtation funds came in 2008 when the pension committed $100 million each to Apollo Credit Opportunity Fund II LP and H.I.G. Bayside Debt & LBO Fund II LP. Both feature in ninth and tenth places respectively in this top ten. Ashmore Global Special Situations Fund IV LP comes in third place from the bottom of UTIMCO’s distressed and special situations fund portfolio, posting a -7.17 IRR for the period.

Last year, UTIMCO invested in one of the largest distressed-focused private equity vehicles to hold a final close. Oaktree Opportunities Fund IX, to which the university committed $25 million last year, was the eighth largest private equity vehicle to be raised during the whole of 2012, closing on $5 billion, according to alternative asset data provider Preqin.

Also according to Preqin, Fortress Credit Opportunities II was the only other distressed debt fund in the top ten private equity funds raised last year,closing on $4.3 billion. UTIMCO hasn’t committed to that fund but is invested in Fortress Credit Opportunities Fund LP, a 2009 vintage fund that takes third place in our top ten, recording an investment multiple of 1.28x and IRR of 27.41 percent.

Within its active portfolio, UTIMCO is committed to a range of high-profile global and domestic buyout and venture capital fund managers, including CVC Capital PartnersDoughty Hanson, EnCap InvestmentsFortress Investment GroupHellman & Friedman Capital Partners and TPG Partnerson the buyout side and Austin VenturesFoundry Venture CapitalUnion Square VenturesSofinnova Venture Partners and Spark Capital on the venture side. Of its total portfolio the 1994 vintage Austin Ventures IV LP comes out tops in performance, posting a 73.14 IRR and 8.4x multiple. The 2012 vintage EnCap Energy Infrastructure Fund LP is the top performing buyout fund for the period, posting a 59.07 percent IRR and 1.86x multiple.

 

10. H.I.G. Bayside Debt & LBO Fund II LP

Vintage: 2008

Commitment: $100 million

Multiple: 1.24x

IRR: 10 percent

 

9. Apollo Credit Opportunity Fund II LP

Vintage: 2008

Commitment: $100 million

Multiple: 1.36x

IRR: 10.73 percent

 

8. Avenue Special Situations Fund V LP

Vintage: 2008

Commitment: $75 million

Multiple: 1.3x

IRR: 10.87 percent

 

7. OCM Opportunities Fund III LP

Vintage: 2000

Commitment: $50 million

Multiple: 1.5x

IRR: 11.93 percent

 

6. OCM Opportunities Fund V LP

Vintage: 2004

Commitment: $25 million

Multiple: 1.61x

IRR: 14.1 percent

 

5. MatlinPatterson Global Opportunities Partners LP

Vintage: 2001

Commitment: $25 million

Multiple: 1.74x

IRR: 15.97 percent

 

4. OCM Opportunities Fund VIIB LP

Vintage: 2007

Commitment: $35 million

Multiple: 1.67x

IRR: 17.64 percent

 

3. Fortress Credit Opportunities Fund LP

Vintage: 2009

Commitment: $30 million

Multiple: 1.28x

IRR: 27.41 percent

 

2. OCM Opportunities Fund IV LP

Vintage: 2002

Commitment: $40 million

Multiple: 1.65x

IRR: 28.03 percent

1. AG Capital Recovery Partners IV LP

Vintage: 2003

Commitment: $20 million

Multiple: 1.58x

IRR: 28.68 percent