Texas Rounds Up Two Pledges To Kick Off New Fiscal Year

The $18.4 billion Employees Retirement System of Texas rang in its new fiscal year by pledging a total of $115 million to two private equity firms.

Greenwich, Conn.-based turnaround firm Littlejohn & Co. nabbed $65 million for its Littlejohn Fund IV LP, which, according to a regulatory filing, has a target of roughly $1.32 billion. Littlejohn invests in mid-sized companies generating revenues of between $150 million and $800 million. The firm especially likes to invest in basic manufacturing, processing, logistics and chemicals.

Texas Employees also pledged $50 million to Quantum Energy Partners V LP, which Quantum Energy Capital closed late last month with $2.5 billion, nearly hitting its $2.75 billion target. The firm makes investments of $100 million to $400 million in exploration and production companies in the oil and gas sectors.

The state retirement system intends to commit $450 million to $750 million to private equity in its new fiscal year, which began Sept. 1, making between nine and 14 pledges altogether.

The limited partner had an actual allocation of 0.6 percent in private equity as of Aug. 31, still a ways from its 8 percent target for the asset class. Texas Employees made its first private equity pledge in 1998 but did not make its second commitment until 2007.