ASRS commits $125m to private equity

The pension is also committing an additional $25 million to a co-investment

The Arizona State Retirement System has approved $125 million in commitments to two private equity funds and an additional $25 million for a co-investment, according to recently released meeting documents.

ASRS will commit $75 million to Blackstone Energy Partners (BEP) II, building on an existing relationship with Blackstone. The pension previously invested in Blackstone Energy Partners I, and also has an investment relationship with the firm on several other platforms. BEP II has a $4 billion target, and is expected to close before the end of the year, according to Private Equity International’s research and analytics division.

Another $75 million will go to Centerbridge Capital Partners III. Fund III has seen record levels of interest – the fund originally had a $5.75 billion target, but the firm attracted more than $11 billion in just six weeks. The fund focuses on generalist control or distressed for control investments in the US and Western Europe. Centerbridge was co-founded by the former head of private equity at Blackstone Group.

Other known investors in Fund III include the San Francisco Employees Retirement System (SFERS), which allocated $50 million as PEI reported earlier this month.

The Los Angeles County Employees Retirement Association (LACERA) is also considering an investment of up to $100 million Fund III, according to meeting documents.

The pension has also approved a $25 million co-investment with Apollo Global Management for the acquisition of certain energy assets from Encana Corporation.

Calgary-based Encana has made a few asset deals with Apollo in recent months. In June, the firm agreed to sell its Bighorn assets in Alberta, Canada to Apollo for $1.8 billion as part of a broader shift of its oil production capabilities toward additional crude output. That sale included 360,000 acres along with interests in pipelines, facilities and service arrangements, Encana said in a statement. Then in late September, Encana bought Texas-based Athalon Energy from Apollo for $5.93 billion, which gave the firm new market share in the Texas oil fields. The deal amounted to a 25 percent premium at $58.50 per share. Encana is Canada’s second largest gas producer.