Maine gets $30m access to KKR

The $10bn pension system, which only started investing in private equity in 2008, has added some of the biggest names in the asset class to its portfolio, including KKR, Blackstone, Carlyle and Hellman & Friedman.

Maine Public Employees’ Retirement System has committed $30 million to Kohlberg Kravis Roberts’ 11th North American fund, a big win for a relatively new investor in private equity that in stronger fundraising environments may not have had access to such a big-name fund.

The commitment is subject to legal reviews and final due diligence, according to Andrew Sawyer, chief investment officer of MainePERS.

Maine, with $10 billion in assets, has invested in private equity since 2008 and came into the asset class at an advantageous time for a small public system. In the tight fundraising environment that emerged after the financial crisis erupted in late 2008, many funds have had to open their ranks to new investors as their reliable LPs cut back on commitments or declined re-ups.

This opened the way for smaller, newer programmes like Maine’s to get access to highly desirable funds.
 The system has committed to the likes of The Blackstone Group, GTCR, Hellman & Friedman, The Carlyle Group and Oaktree Capital Management.

Maine uses Cliffwater as its private equity consultant. The pension system last week also named the firm as its infrastructure consultant, replacing Hewitt EnnisKnupp, as part of a consolidation, Sawyer said.

The pension system has a 5 percent target to private equity, and had an actual allocation to the asset class of only 0.8 percent as of 30 September. The pension system has a target of 5 percent to infrastructure and an actual allocation of 1.7 percent and a target of 10 percent to real estate and an actual allocation of 5 percent.

Last year, Maine found its way into another highly desirable fund, GTCR Fund X, which closed on $3.25 billion earlier this year, the firm’s largest ever fundraising haul.

KKR has been moving solidly through its fundraising, which launched last year. The firm is understood to have collected at least $4 billion. KKR, whose internal fundraising group is led by former Goldman Sachs executive Suzanne Donohoe, has signed on a group of US public pensions including its oldest investors, the public pension systems of Washington State and Oregon, as well as the state pension system of Massachusetts.