Penn. LP Commits Up To $245M

By
Brad Meikle
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Pennsylvania’s State Employees’ Retirement System (SERS) showed that the Keystone State would be no exception to limited partners continuing or increasing their commitments to private equity. The SERS board last week agreed to commit up to $280 million in alternative asset investments, with the overwhelming bulk of that going to private equity.

Summit Partners was the largest beneficiary. SERS committed up to $110 million as a follow-on investment to Summit Partners Private Equity Fund VII and an additional $25 million to Summit Partners Venture Capital Fund II. The Boston-based private equity firm specializes in buyouts and later stage deals and raised more than $2 billion for its Summit Ventures VI buyout fund in 2001.

SERS agreed to invest up to $35 million in Morgenthaler Ventures’ newest fund, Morgenthaler Partners VIII. Morgenthaler Ventures is based in Menlo Park, Calif., and focuses on early and later stage venture deals. Morgenthaler Partners VII closed in 2001 with $869 million.

Audax Group got the nod for a follow-on investment of up to $25 million for its newest buyout fund, Audax Private Equity Fund II. The Boston-based firm closed its first Private Equity Fund in 2000 with $500 million and raised a $440 million mezzanine fund in 2001.

The SERS board approved $25 million for Oaktree Capital Management’s OCM/GFI Power Opportunities Fund II, a buyout fund that raised more than $589 million last year, according to Thomson Venture Economics (publisher of PE Week). Oaktree Capital Management is a buyout and distressed debt firm based in Los Angeles.

San Diego-based VC firm JMI Equity received a SERS commitment for $25 million for JMI Equity Fund V. The firm’s last fund, JMI Equity IV, closed in 1999 with $226 million.

Not simply sticking to private equity, SERS also approved a follow-on investment of up to $35 million in Westbrook Real Estate Partners VI. The fund is managed by New York-based real estate investment group, Westbrook Partners.

SERS manages about $26.6 billion and its portfolio includes Apax Partners, New Enterprise Associates, Summit Partners, Blackstone Capital Partners, Lexington Partners and HarbourVest Partners.