U of Mo Board Approves Pledges To Two Re-Ups

The board of curators for the $3.7 billion in University of Missouri funds recently approved commitments to two funds, a pledge of $15 million to Welsh, Carson, Anderson and Stowe Fund XI and a commitment of the lesser of $15 million or 9 percent of the total capital raised by fund-of-funds Vectis Life Sciences Fund II.

Both pledges are re-ups, with the university having committed $15 million in WCAS X and $10 million in Vectis I. WCAS Fund XI is earmarked for investments in growth-oriented companies in the information, business services and health care industries and has a fundraising goal of $4 billion and a hard cap of $5 billion. WCAS IX generated an investment multiple of 1.8 and an IRR of 17.6 percent as of Dec. 31, according to the California Public Employees’ Retirement System.

Vectis II, a venture capital vehicle, is earmarked for the U.S. health care and life sciences industry through fund investments and direct investments and has a fundraising goal of $175 million. By deciding to commit to a percentage of the fund instead of a fixed amount, the university seeks to protect itself if Vectis II does not reach its target. (Vectis I had a target of $100 million but only raised about $80 million, according to board documents.)

The board invests on behalf of the University of Missouri Endowment Fund and the University of Missouri Retirement, Disability and Death Benefit Plan. As of March 31, 2008, the combined commitments to private equity in the retirement and endowment funds totaled $155 million. The 5.0 percent private equity allocation target amounts to about $187 million, so the limited partner still has a little room to commit more to the asset class.

The board approved an increase in the allocation to the private equity asset class from 2.5 percent to 5.0 percent in early 2007.