Washington State backs TPG and TPG Sixth Street with new PE commitments

  • Why this is important: Washington state backs 2 TPG vehicles: Rise Fund impact, Sixth Street Capital Solutions
  • AUM: $132.3 bln; PE: $21.3 bln
  • Target allocation to PE: 23 pct
  • Contact the board: +1 360-956-4600 or recep@sib.wa.gov

Washington State Investment Board at its February meeting approved $750 million in private equity commitments, backing funds focused on growth, credit, and impact investments.

The board committed:

  • $300 million to Stone Point Capital’s Trident VIII fund, which has a $6.5 billion hard cap and will focus on North America and Western Europe buyouts in the financial services industry;
  • $200 million to TPG Sixth Street Partners’ TSSP Capital Solutions fund, which focuses on credit and equity investments in growth companies and has a $2 billion target;
  • $200 million to Menlo Ventures’ Menlo Special Opportunities Fund II, which has a $500 million target size;
  • $250 million to TPG Growth’s Rise Fund II, which has a $3.5 billion hard cap and will pursue control and non-control stakes in small- and middle-market buyout and growth companies that achieve measurable social or environmental benefits.

TPG’s second impact fund will focus on the healthcare, education, financial services and energy sectors. Washington State previously committed $200 million to TPG’s first Rise Fund.

The investment board had already revealed its planned commitment to TPG Sixth Street Partners earlier in the month, when its private markets committee approved the recommendation.

The investment board also approved $450 million in other new private-markets commitments, backing a real estate fund and a green energy infrastructure fund.

The board, which controls $132.3 billion in assets, including the state’s pension fund, has a 23 percent target allocation to PE.

The pension fund’s PE portfolio was valued at $21.3 billion as of January, putting it near the lower end of its policy target of 19 to 27 percent.

Action Item: Read Washington State’s latest PE IRR report: https://bit.ly/2TIc2i7