The Alaska Permanent Fund Board of Trustees has approved two private equity commitments at its December 10, 2014 meeting, according to recently released meeting documents.
The commitment will be made in two parts to Dyal Capital Partners the private equity arm of Neuberger Berman, which acquires minority stakes in GPs. $50 million will go to Dyal Capital Partners III, a fund focused on acquiring those stakes. An additional $500 million will go to a pool of funds from which Dyal makes co-investments alongside Fund III.
The co-investment pool offers a lower fee structure, which the pension says will allow it to grow its allocation with a built in cost savings advantage.
“It is to Alaskans’ advantage when we are able to make these sort of direct investments because the management fees are much lower than if we relied on an intermediary manager,” said Bill Moran, Board Chair. “Over the years we have increased the Board’s knowledge of private equity investments and built up the Corporation’s internal capability, so we are comfortable taking on internal investments.”
In July, Dyal and four other institutions bought a passive 10 percent stake in Providence Equity Partners. The $1.5 billion fund typically acquires passive stakes of 10-20 percent through its fund vehicles or in co-investments with other institutions. Other players in the fund stakes market include Blackstone and Foundation Capital Partners.
Deutsche Bank is also reported to be in advanced talks to sell its minority stake in London hedge fund Arrowgrass Capital Partners to Foundation Capital Partners. Foundation Capital Partners could pay as much as $200 million for a 20 percent interest in Arrowgrass. Arrowgrass is a $5 billion multi-strategy fund.