MassPRIM fires off $301 mln in PE, VC commitments

  • MassPRIM re-ups to Berkshire, Thoma Bravo
  • Also backs Union Square Ventures 2016 fund
  • MassPRIM PE allocation netting 13.2 pct since inception

The Massachusetts Pension Reserves Investment Management Board earmarked $301 million for private-equity and venture-capital funds through early 2016, according to a March 22 investment report. The $58 billion retirement system set a $1.4 billion commitment pace for private equity in January.

Recent commitments include a $175 million allocation to Berkshire Fund IX and a $100 million commitment to Thoma Bravo Fund XII, according to the report.

Boston-based Berkshire Partners set a $5.5 billion target for its ninth flagship fund. The firm will use leveraged buyouts, recapitalizations, growth-capital transactions and corporate carve-outs to acquire middle-market businesses across a wide range of sectors, according to University of Michigan Board of Regentsdocuments.

Berkshire’s previous fund, a $4.5 billion 2011 vintage, netted a 5 percent internal rate of return through Sept. 30, according to Maine Public Employees’ Retirement System documents. Fund VII closed on $3.1 billion in 2006 and netted a 16.5 percent internal rate of return through March 31, 2015, according to University of California documents.

MassPRIM also committed $100 million to software-sector specialist Thoma Bravo’s 12th flagship fund. The firm set a $7 billion target for Thoma Bravo Fund XII, almost doubling the size of its $3.65 billion 2014 vintage fund.

Thoma Bravo X, which closed on $1.25 billion in 2012, netted a 34.3 percent IRR through March 31, 2015, according to California State Teachers’ Retirement System documents.

In addition to its commitments to private equity, MassPRIM allocated $11 million to Union Square Ventures’ 2016 fund. MassPRIM’s investment board approved a $15 million commitment to Index Ventures VIII as an interim recommendation at its January 13 meeting, but the commitment has not been finalized, according to the report.

The retirement system considers venture capital a sub-strategy of its private-equity allocation.

MassPRIM’s March 22 investment report also details a $90 million commitment to Anchorage Illiquid Opportunities V made through its private debt allocation, according to the report. New York hedge fund Anchorage Capital Group set a $1.25 billion target for the fund, according to SEC filings.

The retirement system was over-allocated to private equity on Jan. 31, according to an investment report. PRIM held 11.3 percent of its assets in private equity, 1.3 percentage points above its 10 percent target for the asset class, according to an investment report.

As of Jan. 31, MassPRIM’s private-equity portfolio netted a 13.2 percent IRR since inception.

Action Item: For more information about MassPRIM, visit www.mapension.com