Rhode Island invests $75 mln in Clearlake Capital and Eureka Equity

  • AUM: $8.4 bln
  • PE allocation: 6.7 pct; PE target allocation: 11.25 pct
  • Whom to contact: Evan England, evan.england@treasury.ri.gov
  • Why this is important: The system’s latest commitment is in line with its plan to invest in 10 companies a year

Rhode Island State Investment Commission at its May 29 meeting approved $75 million in private equity commitments spanning the healthcare and technology sectors, the system’s director of communications, Evan England, told Buyouts.

The commission pledged $30 million to Clearlake Capital Group’s Opportunities Fund II, targeting $1 billion. The fund will focus on middle-market companies in software, technology-enabled services and industrials and target a 15 percent net internal rate of return, meeting documents show.

Clearlake’s first Opportunities Fund exceeded the return on the Bloomberg Barclays US Corporate High Yield Return by 8 percent per year by generating a net IRR of 12.1 percent, according to a memo.

Rhode Island will make a secondary purchase into Eureka Equity Partners’ third fund. The system will make a $25 million commitment to the fund, a memo shows. Eureka III is targeting $175 million.

The system also recommended a $20 million commitment to Eureka IV, targeting $225 million. Eureka’s fourth fund focuses on lower-middle-market companies in business services, healthcare services, consumer products and specialty manufacturing, according to an investment memo.

Rhode Island’s latest commitments are in line with its plan to invest $20 million to $60 million to PE funds. England told Buyouts in April that the system planned to make “10 commitments a year for the next few years.”

Rhode Island’s PE allocation is at 6.7 percent on a 11.25 percent target.