Connecticut purges Triumph interests

The state pension fund has sold all its interests in funds managed by scandal-tainted Triumph Capital to secondary buyer Coller Capital at a significant discount, according to a source.

Another chapter in the saga of corrupt Connecticut state treasurer Paul Silvester has ended with the sale of four partnership interests controlled by private investment firm Triumph Capital.

According to a source familiar with the transaction, the interests were sold to Coller Capital at a discount to net asset value.

The Connecticut state treasury, now headed by Denise Nappier, has sought to cut business ties with defunct Triumph Capital after the Boston firm and its chairman, Fred McCarthy, was found guilty of criminal gratuity last year. The charges were related to dubious fees and favours granted by Triumph to friends of the former state treasurer, Silvester, in exchange for a commitment of state money to the firm.

McCarthy was sentenced to a year in prison and his firm dissolved.

The secondary transaction reportedly took place earlier this year. The Camelot Group acted as advisor to Connecticut. A spokesperson for Coller Capital declined to comment.

London-headquartered Coller Capital, founded in 1990 by Jeremy Coller, is one of the leading participants in the private equity secondary market with a track record of structuring innovative transactions.

The firm is currently investing Coller International Partners IV, a $2.6 billion structure which remains the largest dedicated secondary fund raised to date.

Coller IV was closed in October 2002. Several transactions later, including some large bets such as a $900 million transaction involving the purchase of 41 fund investments and 16 direct holdings from Abbey National in January 2004, the firm is currently preparing to raise its next vehicle in 2005. Market participants expect that fund to potentially be even larger than Fund IV.