ABRY works to fit LPs into crowded Senior Equity Fund V

ABRY Partners has one of those problems we’d all like to have: overwhelming demand.

The Boston firm is in market with its fifth Senior Equity fund targeting $1.05 billion, according to a limited partner with knowledge of the fund and a Form D the firm filed in November.

ABRY appears to have limited space for the in-demand fund. It’s unclear whether LPs’ preferred allocations to the fund are being cut back. One LP with knowledge of the fund said, “We have not seen any cutbacks, but I suspect it is LP specific.”

Alameda County Employees’ Retirement Association said in a December investment report that it approved a commitment of as much as $25 million to Fund V. ABRY indicated, however, that the county pension, an existing LP, would likely get an allocation of $8 million to $9 million, the report says.

No one at Abry returned a request for comment emailed Wednesday.

A handful of firms, including ABRY, enjoy heavy demand from LPs because of strong and consistent past performance. ABRY’s Senior Equity Fund IV, which collected $950 million in 2012, was generating an 11.45 percent net internal rate of return as of Sept. 30, 2016, Maine Public Employees’ Retirement System performance information shows.

ABRY Senior Equity Fund V will pursue the same strategy as the prior fund, investing $20 million to $90 million in preferred equity and mezzanine debt in ABRY-sponsored or outside companies.

Fund V has already gathered several public-pension pledges, including as much as $25 million from Illinois Municipal Retirement Fund; up to $10 million from San Mateo County Employees’ Retirement Association; and up to $20 million from Maine PERS.

Action Item: Read the Alameda investment report here: http://bit.ly/2jA51AJ

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