The Teachers’ Retirement System of the State of Illinois has backed the debut fund of a spin-out from hedge fund SAC Capital’s private equity team called Siris Capital Group.
Siris launched in February. The firm is reportedly targeting $400 million for investments in mid-size telecom and healthcare companies, according to financial web site Business Insider. Siris was founded by Frank Baker, Peter Berger and Jeffrey Hendren, the web site reported.
Baker, Berger and Hendren left Ripplewood Holdings in 2007 to launch the SAC Capital’s private equity arm. According to a Financial News report, SAC may have been trying to unload its private equity holdings through the spinout to become more liquid and meet redemptions from 2008 and 2009.
Illinois invested in Siris through its emerging managers’ programme. The $37.1 billion system also committed an initial $10 million to LiveOak Management Services’ debut fund as a part of its $25 million commitment to the firm, which is targeting investments in materials processing, component construction and software development companies. LiveOak is based in Texas.
In other news, the pension also committed $100 million to Vista Equity Partners’ fourth fund targeting $2.5 billion for the software and technology sectors. The San Francisco-based firm has already collected around $1.6 billion, the marketing of which has been driven by Vista’s impressive overall cash-on-cash return multiple of 3.8x and an internal rate of return of just under 50 percent since inception. Under the terms of its fourth fund, Vista has implemented a European-style waterfall, meaning that LPs must get paid back all their capital plus a preferred return before the GP collects any carry.
TRS posted a 24 percent preliminary investment return for the 2011 fiscal year. The retirement system maintains a 12 percent targeted allocation to private equity.