The Teachers’ Retirement System of the State of Illinois approved a 12-month tactical investment plan that would increase the size of its private equity portfolio by 1.9 percent of total assets Friday. The pension fund will make between $900 million and $1.4 billion in private equity commitments over each of the next five years.
The $3.4 billion portfolio currently comprises 9.1 percent of the retirement system’s $37.3 billion in total assets. Long-term allocations to private equity will increase to 11 percent of total assets in 2012.
In April, the Board of Trustees adopted a new comprehensive asset allocation plan targeting 12 percent for private equity. The portfolio posted a 14.47 internal rate of return through the first three quarters of the 2011 fiscal year.
The pension fund also committed up to $183 million of its private equity portfolio to two funds Friday. Up to $108 million was committed to Stockholm-based EQT Funds Management, which focuses on industrial investments in the Nordic region. EQT closed on its €350 million credit opportunities fund in December.
An additional $75 million commitment was made to Minnesota-based Black River Asset Management, a global fund specialising in food production firms.