Maryland Seeks Non-Discretionary PE Help

The $32 billion Maryland State Retirement and Pension System has issued an RFI in its search for a non-discretionary consultant to assist with its private equity portfolio.

The limited partner will choose one or more firms, with a likely start date of May 1, 2010. Responses are due Dec. 22.

Duties will include helping the pension fund develop goals and strategies for the private equity program; sourcing deals with the pension fund’s staff; performing due diligence; and monitoring the portfolio, which totals $3.9 billion committed to 85 partnerships, of which $1.3 billion has been drawn down and $2.6 billion has not yet been called.

The pension fund is buyouts-heavy, with more than $1.8 billion pledged to the strategy; about $1 billion is committed to special situations.

Recent pledges by Maryland include $100 million to Blackstone VI; $75 million to Clayton, Dubilier & Rice Fund VIII; $100 million to Hellman & Friedman Capital Partners VII; $25 million to Littlejohn Fund IV; and $50 million to Yucaipa America Alliance Fund II. Slugs going to special situations in 2009 include $35 million to Falcon Strategic Partners III and $25 million to TA Subordinated Debt Fund III. Secondary fund Lexington Capital Partners VII received a $100 million pledge.

The pension fund has plenty more to spend on private equity since its actual allocation to the asset class stood at only 3.4 percent as of Sept. 30, well below a 2010 target of 12 percent. In 2008, the state raised its target allocation to private equity to 15 percent from 5 percent.