The $3.6 billion City of Philadelphia Board of Pensions and Retirement recently approved a $10 million investment to Audax Group’s third subordinated debt fund, Audax Mezzanine Fund III, Chief Investment Officer Christopher McDonough told Buyouts.
The $750 million-targeted mezzanine fund marks a follow-up to the firm’s $700 million second fund, which the firm began investing from in July 2006. The new fund was first reported by peHUB, a sister publication of Buyouts, in July. Audax has a mid-market focus, with an average investment size of $20 million.
The New Hampshire Retirement System committed $20 million to the vehicle in July, and the the Manchester (NH) Employees Contributory Retirement System, which has $1.5 million to pledge to the strategy, has chosen the firm as a finalist in its search for a mezzanine fund manager.
In June, Philadelphia promised $10 million to TA Associates’s TA XI LP. That pledge and the aforementioned pledge to Audax Group’s new mezzanine fund were the LP’s only private equity commitments in 2009, said McDonough. The pension fund has not yet decided how much, if any, will be committed to private equity in 2010.
Pledges made in 2008 include ones to Altaris Healthcare Partners II LP ($20 million); Blackstone Capital Partners VI ($20 million); Levine Leichtman Capital Partners IV LP ($25 million); and Riverside Capital Appreciation Fund V LP ($20 million).
The pension fund’s actual allocation to private equity now stands at 11.5 percent; the target allocation at 12 percent.