OMERS Private Equity has been making private equity investments for OMERS since 1987 and manages an estimated $4 billion in investments globally. The fund has a current target allocation of 10 percent but has the ability to go as high as 12.5 percent. Today, the actual allocation stands at just more than 8 percent. The current portfolio divides around 65-35 between fund commitments and directs. Eventually direct investments will represent up to 80 percent of the portfolio.
“At OMERS Private Equity we fundamentally believe active management adds value over passive management and we have the scale and skills to make private equity investments directly rather than through a private equity fund,” Paul Renaud, president and CEO of OMERS Private Equity, said in a prepared statement. “By doing this we reduce our costs (ie. no management fees and carried interest) and we control our investment decisions (both acquisitions and divestitures). Also, unlike private equity funds, we have the ability to hold an investment for an indefinite period of time.”
OMERS Private Equity plans to participate in mid-market buyouts in Canada, the United States and Western Europe. The team is looking to invest between $100 million Canadian ($94.0 million) and $500 million Canadian in each deal. The firms seeks businesses with talented and proven management teams, strong and defensible market positions, and products or services that have a well defined strategy for either organic or growth through acquisition.
For the time being, the team will continue to make fund commitments where market exposure is desired, and where OMERS Private Equity has no ability to do directs. In such relationships the firm will look for the ability of the fund manager to produce co-investment opportunities, a proven track record, and a strong investment team that is financially committed and like-minded when it comes to investment philosophy.
Funds in which OMERS Private Equity is currently invested include ones managed by
OMERS Private Equity is going down a similar route as that of