Oregon backs four PE managers for $900 mln

  • Oregon backs new funds from KKR, EnCap, GI Partners
  • GI commitment subject to final negotiations of terms
  • Oregon has 19.5 pct of assets in PE

Oregon Public Employees Retirement Fundallocated $900 million across four private equity funds in the first quarter, state investment council documents released before its April 26 meeting show.

Oregon committed $250 million each to three PE funds raised by Kohlberg Kravis RobertsEnCap Investments and GI Partners, as well as $150 million for Genstar Capital Partners VIII, according to meeting materials.

The commitment to GI Partners V remains subject to final negotiation of terms and conditions, spokesman James Sinks wrote in an email. The other three commitments have been finalized.

The commitment to KKR went to the firm’s third Asian buyout fund, which is targeting $7 billion. Oregon previously committed $100 million to KKR’s first Asian buyout fund, which was netting a 13.7 percent internal rate of return through Sept. 30, Oregon documents show. Its $200 million commitment to the $6 billion KKR Asian Fund II has yet to generate meaningful returns.

EnCap is targeting $6.5 billion for its latest flagship fund, which would match the $6.5 billion it raised through its 10th flagship fund in 2015. Fund X is too young to have generated meaningful returns, but Fund IX was netting a 14.2 percent IRR as of Sept. 30, according to a Hamilton Lane report presented to Teachers’ Retirement System of Louisiana earlier this year.

GI Partners V set a $2.3 billion target for Fund V, Washington State Investment Board documents say. Oregon is also an LP in the firm’s fourth fund, which raised $2 billion in 2013.

GenStar closed its eighth flagship fund on $3.95 billion in March. The oversubscribed final close included $650 million of “overage capacity” fundraising collected from certain LPs, as well as $200 million from general partners.

Oregon had 19.5 percent of its assets in PE as of March 31. The retirement system set a 17.5 percent target allocation for its private equity portfolio in 2015.

Action Item: Oregon’s meeting materials: http://bit.ly/2q2mgeP