Oregon State Treasury bet big on the latest fund from Stonepeak Infrastructure Partners, spokeswoman Rachel Wray confirmed to Buyouts.
Oregon committed $500 million to Stonepeak Infrastructure Partners Fund IV at its meeting on March 11. The fund is targeting $10 billion, according to sister title Infrastructure Investor, and has a 1.5 percent management fee, a 20 percent carry and an 8 percent hurdle. The commitment is for Oregon Public Employees’ Retirement System.
The Stonepeak fund, expected to hold a first close on $7 billion by the end of April, is planning to make between eight and 12 individual equity investments of $250 million to $2.5 billion, aiming for controlling stakes in its portfolio companies. The target net internal rate of return is 12 percent. The fund will have a five-year investment period and a 12-year duration with up to three one-year extensions, subject to approval from the firm’s LPs.
According to the public book for its March 11 meeting, Oregon has committed to all three previous Stonepeak funds, dating back to 2012. These include $100 million to Stonepeak Infrastructure Partners Fund in 2012, $400 million to Stonepeak Infrastructure Partners Fund II in 2015 and $400 million to Stonepeak Infrastructure Partners Fund III in 2017.
Fund IV will have the same focus as the previous funds, investing in infrastructure assets with focuses in transportation and logistics, power and utilities, communications and water in the United States and Canada. Across the three previous funds, the firm’s aggregate investments have been 1 percent water, 8 percent power and utilities, 16 percent communications, 38 percent transport and logistic and 38 percent midstream, according to data from Louisiana Teachers.
Stonepeak has oversubscribed all of its previous funds, according to II. Fund I targeted $1 billion and raised $1.65 billion. Fund II targeted $2.5 billion and raised $3.5 billion. Fund III targeted $5 billion and raised $7.2 billion. Fund IV has not set a hard-cap.
According to data from Louisiana Teachers, Stonepeak Infrastructure Partners III had a 21.1 percent net IRR and a 1.1x total value to paid-in multiple. Fund II had a 14.6 percent net IRR and a 1.2x TVPI. Fund I had a 12.2 percent net IRR and a 1.4x TVPI.
Stonepeak spun out of Blackstone in 2011. It was co-founded by Michael Dorrell and Trent Vichie. Employees of the firm will be committing a minimum of 1.5 percent of the capital commitments, which will add up to $150 million assuming the fund reaches it target. The Oregon documents indicate the firm has hired at least 21 additional staff since launching Fund III.
As of January 31, OPERF was valued at $81.6 billion.
Action Item: read the Oregon March 11 meeting book here.