PSERS outlines private equity pacing information

The Harrisburg-based public pension has revealed its private equity pacing plans for FY 2021.

Institution: Pennsylvania Public School Employees’ Retirement System
Headquarters: Harrisburg, US
AUM: $69.60 billion
Allocation to private equity: 17.1%

Pennsylvania Public School Employees’ Retirement System has revealed its private equity pacing information for the rest of 2021, according to materials from the pension’s October investment advisory council meeting.

Highlights from Pennsylvania Public School Employees’ Retirement System’s October 2021 investment advisory council meeting

  • PSERS has outlined its private equity pacing range for FY 2021, with total capital of between $800 million and $1 billion hoping to be committed by the end of the year. However, a contact at the organisation informed Private Equity International that it expects to miss the lower benchmark of this pacing target by $15 million.
  • The public pension has also announced its plans to reduce its exposure to private equity. Currently allocating 17.1 percent of its full investment portfolio to the asset class, which equates to $11.8 billion, PSERS has set a target of 2025 to reduce this to 12 percent.
  • As of 7 October, Pennsylvania had approved $685 million of commitments across six private equity vehicles this year. Future commitments will be mainly reups, but the board may seek to add new GPs with a proven ability to add value to their portfolio companies and generate top-quartile performance. The focus of these new GPs will be on growth equity or venture capital strategies.

PSERS’ private equity commitments for FY 2021 have predominantly focused on North American investment vehicles, largely comprising venture capital and growth equity strategies. Average ticket sizes have fluctuated between $80 million and $125 million, with a peak commitment of $150 million made to Summit Partners Growth Equity Fund XI in September.

Other recent private equity commitments confirmed by PSERS include $135 million to Apax Digital Fund II and $168.75 million to Insight Partners Opportunities Fund I.

Darren Foreman is director of public equity at PSERS. He is a 25-year veteran of the pension, having also held the roles of portfolio manager and senior portfolio manager for private markets and co-investments. He manages an in-house private equity co-investment programme, having closed 65 deals to date, alongside performing due diligence of private markets funds. Foreman also serves on the advisory board of several global private equity funds.

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