Franklin Templeton and Asia Alternatives have launched a private equity fund of funds business that will offer bespoke investments across global buyout, growth and expansion, venture capital and special situations.
Arthur Wang, former managing director for private markets at the $25 billion San Francisco Employees’ Retirement System, will lead the unit, dubbed Franklin Templeton Private Equity. He will join as managing partner in October.
The business will complement Franklin Templeton’s existing business and is expected to appeal to both existing and new institutional clients, a spokeswoman for the California-headquartered investment firm told Private Equity International.
Franklin Templeton will be the majority owner of FTPE and Asia Alternatives and members of the FTPE management team will hold minority stakes in the new entity, according to a statement from the firms.
The pair will fund the operating capital needs of the business to get it up and running, providing the team a “runway” until fundraising, at which time FTPE will seek to operate on a standalone basis. The target of its debut fund is unclear. Both will additionally fund their pro rata shares of the GP commitment and Franklin Templeton will also provide capital as a limited partner in FTPE investments.
FTPE, which will be based in the San Francisco Bay area, will have a new investment team separate from the two firms.
Wang led SFERS’ investments in private equity, venture capital, real estate, natural resources and other real assets. He was previously director for private equity for the New York State Common Retirement Fund where he oversaw a $15 billion global private equity portfolio. Earlier in his career he was executive director and head of US private equity at Hong Kong-based manager CDIB Capital.
Brian Wachowicz, vice-president of alternatives at Franklin Templeton, will also join FTPE as a principal in October. FTPE will look to start increasing its headcount immediately, adding professionals who have multi-manager, co-investment, secondaries and direct private market experience.
Franklin Resources has over $733 billion in assets under management and invests across equity, fixed income, alternatives and custom solutions.
Melissa Ma, co-founder and managing partner for Asia Alternatives, added that FTPE allows Asia Alternatives to maintain its core focus on Asia and its LPs. The firm raised $1.8 billion for Asia Alternatives V and its sidecar vehicles in September last year. The San Francisco pension fund, Florida State Board of Administration, Massachusetts Mutual Life Insurance Company and Minnesota State Board of Investment are investors in the fund.