LGT wins Swedish pension mandate

Switzerland-based LGT Capital Partners has set up a private equity fund investment programme for AP7, a Swedish pension scheme with $4.2bn in assets.

LGT Capital Partners, the Pfaeffikon, Switzerland-based alternative investment manager, has secured a mandate to invest in European private equity funds on behalf of The Seventh Swedish National Pension Fund (AP7).

According to a press release, the Stockholm-based group has made an initial investment in LGT’s Crown European Buyout Fund, to which commitments in European buyout and venture funds as well as secondary transactions will be added.

AP7, which currently has $4.2 billion (€3.44 billion) of assets, has had exposure to private equity since 2002 after allocating four percent of its capital to private equity and four percent to hedge funds.

Since then, the pension has been an investor in LGT’s listed fund Castle Private Equity. It also has money in co-mingled funds of funds managed by Boston-based HarbourVest Partners and has a separate account with US gatekeeper Hamilton Lane. It is also invested in a listed private equity structure managed by London-headquartered private equity specialist Pantheon Ventures.

Richard Gröttheim, executive vice president, said AP7 had an annual capital inflow of approximately SEK7 billion (€750 million; $920 million) of which four percent would be invested in private equity each year. AP7’s 2004 commitment to the new LGT account amounted to approximately $20 million, he said.

According to Tycho Sneyers, head of business development at LGT Capital Partners, the group now has some 40 active client relationships on the private equity side of its business, including mandates from AP3 and the London Pension Fund Authority. At the end of 2003, it managed some $2.8 billion of private equity capital and $1.6 billion in hedge funds. The group’s largest client is Liechtenstein’s royal family.