The California Public Employees' Retirement System has allocated $546 million to Standard Life Investments (Private Equity) Limited (SLIPE), which will deploy the capital into small to middle market buy-out funds in Europe, creating a middle market European fund of funds.
The European Strategic Partners-Golden Bear Europe (ESP-GBE) Fund will give CalPERS access to these European funds to generate high returns and possibly graduate to the main lineup of the CalPERS Alternative Investment Management (AIM) Program for private equity.
“Our new partner offers us unique access to the premier managers and co-investment opportunities in Europe, leveraging SLIPE’s strong relationships and proven track record,” said CalPERS Chief Investment Officer Russell Read. “We have a particular need for a partner who will focus exclusively on Small to Middle market European private equity.”
SLIPE is based in Edinburgh, Scotland, and has an office in Boston, Massachusetts. The firm provides European and U.S. private equity fund of funds services to clients from 24 different countries and has raised over $7 billion since 1998. It is globally ranked by Watson Wyatt as the sixth largest manager of private equity funds of funds for pension plans.
David Currie, Chief Executive of SLIPE, said of the new mandate, “We expect the ESP-GBE Fund to start making commitments to European private equity funds imminently and we are looking to create a strong, well diversified portfolio.”
The new vehicle is the latest of several created by the CalPERS AIM Program over the past 13 months as part of the program’s ongoing strategic realignment. The program is emphasizing larger relationships with fewer partners while utilizing customized investment vehicles to deploy significant capital in attractive sectors of the market – including underserved California areas, emerging managers, venture capital, clean technology, emerging markets, and healthcare delivery.
Since 1990, CalPERS has invested in private companies primarily through limited partnerships or funds, typically with managers or general partners acting as third parties that invest the pension fund’s capital. The market value of AIM Program investments is more than $17 billion.
CalPERS is the nation’s largest pension fund with assets totaling more than $245 billion. The pension fund administers retirement and health benefits for approximately 1.5 million current and retired public employees and their families. For more information on CalPERS, visit www.calpers.ca.gov.
