LPs

Texas ERS commits $385 mln to PE in May

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Texas Employees Retirement System, pension fund, private equity, LGT Capital Partners, Texas teachers
  • Texas ERS updated its pacing plan to account for recent large commitments
  • The recent commitments include two LGT Capital Partners funds
  • TA Associates, TPG, and Advent also received allocations

Texas Employees’ Retirement System committed $385 million to private equity in May, a busy month that contributed to pension’s decision to lift its pacing target for 2019.

The $28.2 billion retirement system committed:

  • $110 million to Advent International Global Private Equity Fund IX, which raised $17.5 billion to invest primarily in Europe and North America;
  • $125 million to LGT Capital Partners’ Crown Asia Private Equity Fund IV;
  • $100 million to TA Associates’ XIII fund, which raised $8.5 billion to focus on global growth companies and small-to-medium buyouts;
  • $25 million to TPG Healthcare Partners, which has a $2.5 billion target, and
  • $25 million to TPG Partners VIII, which has a $11 billion target

Texas ERS had initially planned to commit $1 billion to PE for all of 2019, but increased that target to $1.45 billion at its latest meeting, citing recent large commitments, including commitments to LGT Capital Partners. In addition to LGT’s Asia fund, Texas ERS also approved a $100 commitment to LGT’s Crown Secondaries Special Opportunities Fund II.

The retirement system has a 14.6 percent allocation to PE, with a target allocation of 13 percent. Under the new pacing strategy, Texas ERS plans to commit $1 billion to PE in 2020 and 2021, before increasing its allocation to $1.2 billion in 2022.

Texas ERS intends to invest a significant portion of that in co-investments, targeting $200 million in 2020 and 2021 and $240 million in 2022.

Action Item: View the updated Texas ERS pacing plan here https://bit.ly/2X3pLlj