Side Letter: GIP’s Ogunlesi on racism, Warren’s warpath, KKR’s Asia view

How has the top of the PE tree changed since we started tracking the world's largest managers? We've put the answer in an animation. Plus: Global Infrastructure Partners' founder on race, Warren on vultures and KKR on tensions in Asia.  

He said it

“Some of these tensions are long term, so we just need to adapt to this new operating environment and this becomes our base-case going forward”

Ming Lu, KKR’s head of Asia-Pacific, tells PEI that geopolitical tensions in the region, talk of decoupling and reshuffling supply chains are the private equity giant’s biggest concerns

We did the math

13 years in 30 seconds. Want to watch the top tier of private equity mega firms change shape before your very eyes? This interactive presentation contains (among other must-see data) a visual illustration of the changing guard at the top of the PEI 300 since we started gathering the data in 2007, when Carlyle topped the tree. Click through to slide three for the full effect.

Just happened

Adebayo Ogunlesi
Ogunlesi: politicians not pushing forward

Systemic racism is not a ‘thing of the past’
Adebayo Ogunlesi, founder of $74 billion private fund firm Global Infrastructure Partners, responded to recent police killings of African Americans in an interview with sister publication Infrastructure Investor by questioning how someone “can behave so inhumanely to another human being”.

“For 400 years, African Americans have been the victims of discrimination in this country,” Ogunlesi says. “Recent events simply have brought to the foreground things that everybody, consciously or subconsciously, knew was in the background.” Ogunlesi, formerly a member of President Trump’s short-lived Strategic and Policy Forum, is also disappointed by politicians’ response. “It seems as if the political leadership is determined not to play a role in moving this forward,” he says.

After witnessing activism swell across the country, Ogunlesi, who has lived in the US for more than 40 years, hopes “this time will be different” in achieving lasting progress towards racial equality. In the finance sector, he says, there’s still a long way to go.

Warren on the warpath
US senator Elizabeth Warren still has private equity in her sights: she’s written a letter to the American Investment Council demanding more information about its lobbying efforts with regards to coronavirus relief funds made available to companies through the CARES Act. In the letter, Warren outright asks the AIC to endorse her Stop Wall Street Looting Act of 2019 and for it to back a series of conditions that would apply to all companies receiving CARES Act funds. It also calls attention to several articles that suggest private equity is relishing the investment opportunities brought about by the pandemic-induced recession.

“I am particularly concerned that the private equity industry you represent may exploit this crisis to continue extracting value out of struggling companies, lining the pockets of wealthy firms at the expense of workers and communities struggling to respond to this pandemic across the country.”

Essentials

Turning 17
CVC IR exec Martin Munte has joined preferred equity firm 17Capital. Munte was formerly a director of IR for CVC Credit Partners

This house believes…
…it will tune in to see a debate between Duke University professor David Robinson and Oxford University professor Ludovic Phalippou at 2pm BST today. Such was the reaction to Phalippou’s last paper on PE that he threw down a challenge to any PE proponents to come and debate him. No one from the industry stepped forward, but Robinson did. We can’t wait. We’ll tell you how it goes.

Dig deeper

Institution: Los Angeles Fire & Police Pension System
Headquarters: Los Angeles, US
AUM: $22.97 billion
Allocation to alternatives: 23.52%

Los Angeles Fire & Police Pension System has confirmed $190.39 million-worth of private equity commitments to six vehicles, according to a document from its June board meeting.

The commitments comprise $20 million to DFJ Growth IV, €53.8 million to CVC Capital Partners VIII, $20 million to Canaan XII, $60 million to Thoma Bravo Fund XIV, $20 million to Thoma Bravo Discover Fund III and $10 million to Thoma Bravo Explore Fund.

The $22.97 billion US public pension has a 12 percent target allocation to private equity that currently stands at 11.13 percent.


Today’s letter was prepared by Toby Mitchenall with Isobel Markham and Adam Le