NYC pension declines to buy stake in Huntsman fund

The $102bn pension board voted to ‘rescind’ approval to buy an LP stake in Huntsman Gay's $1.1bn debut fund after failing to come to agreement with the seller.

The New York City Public Employees’ Retirement System voted to “rescind” its approval to buy an LP stake in Huntsman Gay Global Capital's debut fund, which raised more than $1 billion last year.

A spokesperson for Huntsman Gay said the pension and the limited partner selling the stake could not come to agreement on the sale. A spokesperson for the pension told PEO earlier Thursday the pension had “rescinded” approval of a commitment to Huntsman Gay's fund, but declined to clarify further.

“Upon further review of Huntsman Gay by [NYCERS chief investment officer] Larry Schloss, the potential commitment” was rescinded, a spokesperson told PEO.

The spokesperson for Huntsman Gay stressed the rescinded secondaries deal had no impact on the size of the fund.

Schloss, founder and former head of Diamond Castle Holdings, joined the $102 billion New York City pension earlier this year. At a conference in June, Schloss said the pension was “analysing” its private equity programme, which has about $12.5 billion of commitments to private equity, with $6.8 billion funded at the time.

Pension staff was looking to “trim” the system’s private equity programme based on manager performance through the downturn, Schloss said.

“It’s a real easy time to figure it out – you’ve either done really well through this time or you haven’t. If you have, congratulations and here’s some more money,” Schloss said. “If you made 1.5x your money, you’re probably doing all right. That’ll get you some sort of double digit rate of return and that’s ok.”

Huntsman Gay was formed by former Utah industrialist Jon Huntsman and former Bain Capital director Robert Gay. Among the managing directors are Steve Young, formerly the quarterback for the San Francisco 49ers, a US professional football team.