MassPRIM bets on Thoma Bravo’s debut middle-market fund

  • MassPRIM commits up to $300 mln to Advent’s eighth fund
  • System pledges $60 mln to Thoma Bravo debut middle-market fund
  • Committed $100 mln to Lovell Minnick earlier this year

The Massachusetts Pension Reserves Investment Management Board committed up to $360 million to Advent Internationaland Thoma Bravo at its investment meeting December 1, according to board meeting materials.

The system, which has a 10 percent target allocation to private equity, committed $60 million to Thoma Bravo Discover Fund, which is targeting $1 billion.

Thoma Bravo launched Discover Fund earlier this year and is raising it alongside its 12th flagship fund, which is targeting between $5 billion and $7 billion, Buyoutspreviously reported. Discover Fund will target investments in software and technology in the middle market. The firm expects the fund to make 10 to 12 investments of between $30 million and $150 million each, according to a marketing document seen by Buyouts.

The marketing document, which was sent to LPs in the fall, said Discover Fund had demand over its $1 billion target and the firm would work with LPs to portion out allocations.

Thoma Bravo has traditionally invested in the middle market through its flagship funds, an LP previously told Buyouts. The middle market has grown more attractive, Managing Partner Carl Thoma said at the Buyouts Chicago conference in June.

“That’s the reason middle-market funds will probably be double or triple oversubscribed,” Thoma said at the time. “The lower middle market is a good place to be.”

MassPRIM also committed up to $300 million to Advent International GPE VIII, targeting $12 billion. Advent launched Fund VIII in the third quarter. MassPRIM committed to Advent’s prior fund.

Advent is moving through fundraising on Fund VIII at a fast clip and is basically working to figure out how much allocation to give each LP, according to a fund-of-funds LP who is considering committing to the vehicle. LPs are being cut back, the investor said.

MassPRIM in October committed $100 million to Lovell Minnick Equity Partners IV, which closed in November on $750 million. Overall, MassPRIM committed almost $1.5 billion to private equity and venture capital this year, undershooting its 2015 investment plan of $1.7 billion to private equity, according to board meeting documents.

MassPRIM, which is slightly overallocated to private equity with an actual allocation of 11.2 percent, is searching to add another member to its private equity team, a spokeswoman told Buyouts. Longtime PE officer Peony Keve left at the end of November, the spokeswoman confirmed.

Action Item: Check out MassPRIM’s 2015 annual report here.