Irish pension fund commits €2 billion to PE

The National Pension Reserve Fund intends to allocate 8 percent of its assets to European and North American private equity funds by 2010.

Ireland’s state pension fund intends to make allocations of up to €2 billion ($2.37 billion) to private equity over the next four years.
Adrian O’Donovan, a senior manager at the National Pension Reserve Fund (NPRF), told PEO that the fund was targeting a private equity allocation of 8 percent by the end of 2009. The fund’s assets are currently worth €15.3 billion, but are expected to grow to €25 billion by the end of the decade.
O’Donovan added that the fund intended to split its commitments roughly equally between European and North American funds, and that its focus would primarily be on buyouts.
NPRF made its first private equity commitments last month. So far it has invested €75 million in CVC European Equity Partners Fund IV, €29.5 million in Vestar Capital Partners Fund V and €76.0 million in Clayton, Dubilier & Rice Fund VII.
Although the majority of the funds allocation will be to buyouts, it will also commit up to a quarter to venture capital funds. The fund is already in talks with several major Irish venture capital firms, according to the Irish Times. Venture firms in the country that are expected to come to market this year include ACT Venture Capital, Trinity Venture Capital and Ion Equity.
NPRF is operated by the National Treasury Management Agency, and was established in April 2001 by former finance minister Charlie McCreevy to ensure that the state could meet the future pension liabilities owed to public sector workers and welfare recipients.
The fund does not start paying out until 2025. O’Donovan said that it is “seeking to build long term partnerships” with the private equity industry.