Wisconsin mulls lifting PE allocation

  • $94.6 bln core fund overweight its PE target
  • NEPC urges lifting PE target to 9 pct from 8 pct
  • Board likely to vote on allocation change in December

State of Wisconsin Investment Board is weighing a recommendation to raise its private equity allocation to 9 percent from 8 percent and will likely vote on the proposal in December.

If approved, the change would move the target closer to the states current actual allocation. Wisconsin had $94.6 billion in its core trust fund, and its actual allocation was $8.67 billion, or 8.7 percent, as of June 30.

The asset-allocation change, recommended by NEPC, would also increase small-cap public equity to 3 percent from 2 percent and pare public emerging markets to 3 percent from 5 percent.

CIO David Villa would be responsible for setting subasset-class targets for PE, such as the mix between private debt and private equity, co-investments, and funding new strategies with additional allocations to Wisconsins multiasset classes, according to NEPC.

At its October meeting, Wisconsin did not report any new private-markets commitments, spokesman Chris Preisler said. The last time the investment board reported PE commitments, in August, it reported $350 million in four fund investments and two co-investments.

Between April and June, Wisconsin committed $100 million to TPG Partners VIII, $75 million to TSSP Adjacent Opportunities Partners (D) fund, $50 million to Quantum Energy Partners VII, $50 million to TowerBrook V, $20 million to a consumer-focused co-investment and $20 million to an IT co-investment.

SWIB continues to re-up with high-quality managers and focus on new relationships within small/midsized buyouts and growth equity, meeting materials show.

It has maintained a steady rate of co-investment, seeing high-quality deal flow from existing GPs and beginning to see liquidity from early co-investments in the portfolio.

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