New Hampshire pension commits to HIG’s second Advantage Fund

New Hampshire Retirement System’s desire for a quick return in distributions resulted in a $100 million commitment to HIG Advantage Fund II, which has already made three investments.

LPs are worried about distributions due to a sluggish exit environment. New Hampshire is committing to a fund that is already seeding its portfolio, taking away some of the blind-pool risk.

New Hampshire’s investment committee approved a $50 million commitment to the primary buyout fund and $50 million to a connected co-investment vehicle at the system’s February 13 meeting, which was viewed by Buyouts.

According to Jay Kloepfer, executive vice president at consultant Callan, Fund II had a first close at $1.2 billion. No target for Fund II was made available.

HIG has already made three portfolio company investments out of Fund II, Kloepfer said. “This puts you later in the J-Curve,” Kloepfer said.

HIG’s Advantage series focuses on mid-market companies described by New Hampshire senior investment officer Gregory Richard as “less complex” than firms the manager focuses on in its other funds.

HIG’s first Advantage fund closed at $3 billion in 2018. According to Kloepfer, the manager was slow to deploy capital out of Fund I due to its quick fundraise as it looked to build out its team and sector focus.

Despite its slow deployment, exits from Fund I achieved returns up to 3x, Kloepfer said.

New Hampshire may also continue to grow its relationship with HIG through its other private equity and private credit platforms, Kloepfer said.

Other LPs that have committed to Fund II include Alaska Permanent Fund, Orange County Employees Retirement System and Virginia Retirement System, according to Buyouts’ database.

In addition:

• New Hampshire plans to commit $200 million to private equity in 2024 across four funds. The system closed on just over $200 million in private equity commitments in 2023.