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Oregon convenes special meeting to back Cinven VI

  • Cinven offers incentives to first-close participants
  • Firm targets 5.5 bln euros for Fund VI
  • Cinven expected to hold close soon

The Oregon Investment Council on March 29 convened a special meeting to commit as much as 250 million euros ($282 million) to Cinven‘s sixth flagship fund.

The commitment remains subject to final negotiations of terms and conditions.

The firm is targeting 5.5 billion euros for Fund VI, which is offering “economic incentives” for large commitments (250 million euros or larger) and first-close participants, according to an Oregon investment memo.

The council scheduled the special meeting to consider the commitment while advantageous terms were still available, Oregon spokesman James Sinks said in an email.

“Those favorable terms will not be available at the time of the next regular meeting,” Sinks wrote. He declined to provide specific fund terms offered to limited partners in the first close.

Oregon’s next regular meeting is scheduled for April 20. If Oregon waited to approve the commitment at that meeting, staff would have just one week to finalize terms and conditions before the fund’s projected final close on April 28.

“It takes longer to do that [process],” Sinks said. “We’re talking about due diligence on hundreds of millions of dollars.”

Cinven encountered strong demand for Fund VI, Buyouts reported in December. The firm originally planned to wrap Fund VI in June 2016.

The Oregon Investment Council, which oversees the investments of the state’s $68 billion retirement fund, committed $75.8 million to Cinven’s previous flagship vehicle in 2012. The commitment netted a 10.4 percent internal rate of return as of Sept. 30, according to state documents.

Pennsylvania Public School Employees’ Retirement System investment report pegged Fund V’s net IRR at 19 percent as of the same date. The Pennsylvania agency committed as much as 100 million euros to Cinven VI on March 11.

It is unclear why the LPs differ in their reporting of Fund V’s returns.

Cinven will use Fund VI to build a portfolio of 15 to 20 European buyout investments, comprised largely of companies with enterprise values of as much as 300 million euros, according to Oregon documents. The fund can invest as much as 500 million euros of equity per deal.

Cinven’s investment committee includes David BarkerPeter CatterallHugh Langmuir, Stuart McAlpine and Nicolas Paulmier. The firm maintains nine offices across Europe, North America and Asia, according to its website.

Action Item: To read Oregon’s investment memo on Cinven, click here: http://1.usa.gov/1RxoJUL