Gregory Roth

As part of a long-term expansion of its private investment program, the $107 billion Texas Teacher Retirement System hired private equity giants Kohlberg Kravis Roberts & Co. and Apollo Global Management to each manage $3 billion of the pension’s assets. Back in June, TRS said it planned to make $7 billion in private equity commitments by 2015. According to TRS, the arrangements are “fund-of-funds master limited partnership” agreements. It was not clear whether the firms would invest mainly in their own funds or choose and manage outside funds in a conventional fund-of-funds arrangement. If the latter were true, it would mark a departure for both firms. Unlike The Carlyle Group, which recently bought AlpInvest, a large fund-of-funds manager, KKR and Apollo do not, as of yet, have such a capability.

Saying markets are “not friendly,” one of The Carlyle Group’s co-founders said that the firm may actually not go through with its planned initial public offering after all. “We’re in no hurry,” said Daniel D’Aniello, one of Carlyle’s three co-founders, who was speaking Tuesday at the Quebec City Conference in Canada. “We’ve been around for […]

The Alaska Permanent Fund, one of the few sovereign wealth funds in the United States, appointed Jay Willoughby to be its chief investment officer, effective Nov. 1, according to sister magazine Buyouts. Willoughby joins the $40 billion fund from Ironbound Capital Management, a New Jersey-based hedge fund, where he was a co-managing partner. Ironbound is […]

The results are finally in (thank you, Brown) for the 2011 performance rankings of the eight Ivy League endowments. They are ordered below from the worst percentage return to the best. If you can’t guess the winner (of course, you’re all winners, like little league), we won’t spoil the fun. You’ll just have to page through to see if you’re right. We also throw in a few other interesting tidbits, such as average annual performances over the last decade (although not every school reported this). Being a private equity crew, what you may care most about is how each school did with its buyout investments. Again, we included all the information we could find, but not everyone is as forthcoming as Yale, Harvard and Cornell (hint, hint, to everyone else…).

Keith Bozarth, executive director of the $80 billion State of Wisconsin Investment Board, announced plans to retire in 2012, the extra time being needed to allow SWIB to find a replacement and help with a transition, according to a press release. Wisconsin runs one of the nation’s largest private equity programs. The system’s current private equity target is 7 percent, and SWIB manages about $5 billion in invested private equity capital. In a statement, the chairman of SWIB’s board of trustees, Jim Sentry, said, “We are sorry to see Keith leave, but appreciate his many accomplishments,” adding, “SWIB has accomplished a great deal (under Bozarth), including increasing its internal management of funds from 21 percent to 55 percent and revising its risk management process. These accomplishments have helped SWIB remain a model organization with an outstanding reputation.”

As AXA gears up for a possible sale of its private equity unit, executives at the company could find themselves borrowing from The Carlyle Group’s playbook. AXA Private Equity, and particularly its chief executive, Dominique Senequier, are known to be seeking a management-led buyout financed in large part by one of its suitors. [caption id="attachment_121431" align="alignright" width="180" caption="Dominique Senequier"][/caption] Such a structure is exactly what Carlyle agreed to when it acquired a 50 percent voting stake (and 60 percent of the equity) in AlpInvest Partners, one of Europe’s largest fund-of-fund managers, earlier this year. For Carlyle, the merger helped to diversify its slate of businesses, and more importantly, helped to increase its tally of assets under management prior to its expected IPO next year. For AXA Private Equity’s investors, a management-led buyout would offer incentives for keeping employees on board, something especially crucial in an era of “key-man” provisions. Senequier’s preference for a management-led buyout was first reported in the Financial Times.

Harvard and Stanford, two of the nation’s richest universities, say that endowment returns for fiscal 2011 brought them to within striking distance of where they stood before the financial crisis lopped off billions of investment value. The Harvard Management Company, which manages the university’s endowment, reported a gain of 21.4 percent – or $4.4 billion – in fiscal 2011, which ended on June 30. That gain increased the size of Harvard’s endowment to $32 billion. The gain, on top of fiscal 2010’s return of 11 percent, marks a strong reversal for the giant endowment, which plummeted 27 percent – or $11 billion – in fiscal 2009, from a pre-crisis peak of $36.9 billion in fiscal 2008. That leaves Harvard just $4.9 billion shy of where it was before the financial crisis.

The last time Buyouts, peHUB's sister publication, wrote about Clearwater Capital was January of 2010, when the firm had just begun to raise money for its latest fund, Clearwater Capital Partners IV. Its ambitious $1 billion target seemed reasonable back then, especially since Clearwater’s previous fund, Clearwater Partners III—which closed in 2007—raised $900 million, well above its original $500 million target. Twenty months later, however, it seems Clearwater, which invests in Asian distressed debt and special situations outside Japan, is facing some blustery fundraising headwinds. As of this month, Fund IV has only been able to raise between $200 million and $300 million, according to press reports. An executive at the firm declined to discuss the firm’s fundraising efforts or verify figures. The firm’s placement agent, Greenhill & Co., also declined to comment.

The exodus continues on MassPRIM’s private equity team. Less than two months after the departure of Wayne Smith, Massachusetts Pension Reserves Investment Management’s private equity chief, the pension’s second-most-senior private equity manager, Senior Investment Officer Michael Langdon, also said that he was planning to leave. Langdon’s last day at MassPRIM is set for be Oct. 14, when he will join London-based Hermes Global Private Equity and help establish the firm’s Boston office. Hermes manages $7 billion in private assets, including $1 billion in the U.S. A spokeswoman for the $41 billion pension, Alethea Harney, said the timing of the two departures was an “unfortunate coincidence” and that the two departures “were not related in any way.”

Sixteen California Public Employees Retirement System employees and former employees reached a preliminary settlement to pay fines for allegedly receiving but not properly reporting a slew of gifts that included a face scrubber, a hot air balloon ride and tickets to the Rose Bowl Game. The value of the gifts in question rarely exceeds the low three figures. The largest fine is a relatively modest $3,600. But the humiliation factor? (Priceless.) The list of alleged gift policy violators was made public by the California Fair Political Practices Commission. These penalties are slated to be finalized at a meeting of the FPPC on September 22nd. Recall that the FPPC initially investigated CalPERS employees back in May 2011, following even more severe charges by federal and state authorities alleging that former CalPERS Chief Executive Federico Buenrostro and others on CalPERS's private equity team were wined, dined and sent on luxurious trips at the invitation of Alfred Villalobos, a placement agent and former CalPERS board member who was working on behalf of Apollo Global Management. Villalobos and Buenrostro still face a state level lawsuit, and are also being investigated by federal authorities.