News and Analysis

The nation’s publicly traded private equity firms generally posted strong growth in earnings and fee-earning assets in the second quarter, boosted by markups in their portfolio assets and by strong exits from some holdings.

It looks like we can add Sentinel Capital Partners to the “have” side of the balance sheet. The New York-based buyout shop announced the first and final closing of Sentinel Capital Partners V LP at the fund’s $1.3 billion hard cap.

As part of Preqin’s annual effort to assess the performance of the private equity fund universe, the private equity data provider has produced a “league table” showcasing the firms whose funds consistently outperform their peers. Historically, private equity has demonstrated a stronger correlation between past performance and future results than almost any other asset class, one of the main reasons that competition is so fierce among investors to commit money to managers with consistently strong fund performance. 

In a court case that could add a new risk factor to some deals, the First Circuit Court of Appeals last month ruled in favor of the New England Teamsters and Trucking Industry Pension Fund, which argued that two investment funds managed by Sun Capital Partners were liable for $4.5 million in pension liabilities for Scott Brass Inc, a Sun Capital portfolio company that went bankrupt in 2008.  

The Oregon Investment Council, which manages $80 billion in state funds, has pledged $100 million to Reservoir Capital Group’s debut energy and resources fund, Reservoir Resource Partners LP. The fund plans to invest in energy, natural resources and power generation companies. The firm is seeking to raise $1.5 billion.

Following a second closing in June, Olympus Partners is up to $2.2 billion on Olympus Growth Fund VI LP, and the firm is “pretty much done” with the fundraise, according to a source close to the effort.

More and more endowments and foundations, overwhelmed with the job of managing complex portfolios in a volatile world, are outsourcing their investment functions to third-party money managers, according to an August white paper from the Commonfund Institute. The “outsourced CIO” trend has big implications for private equity firms, as money managers gain discretion over more assets.