Side Letter: New secondaries play from Antin, diversity dialogue with TPG and Carlyle, not loving IRR

The secondaries market is a hotbed of private markets innovation: infra specialist Antin has a new take on a continuation fund. Plus: talking diversity with TPG and Carlyle; evidence of more Korean institutional appetite for PE; ragging on IRR; and more. Here's today's brief, for our valued subscribers only.

He said it

“We are open to looking at partners who may invest in New Zealand Rugby.”

New Zealand Rugby chief executive Mark Robinson speaks to the New Zealand Herald about the potential for private equity investment in the hallowed All Blacks brand, as the rugby organisation struggles with the impact of covid-19. Looking for a comprehensive briefing on how PE is lining up to go long on sport? Read our deep dive here.

Just happened

Responsibility matters
Check out the agenda for PEI‘s Responsible Investment Forum: Europe. It kicks off in virtual format tomorrow. Hope to see you there.

Diversity: 2020 ‘feels different’
In this latest episode of our podcast series Spotlight, Carmela Mendoza interviews Kara Helander, chief inclusion and diversity officer at Carlyle Group, and Anna Edwin, global head of talent development at TPG on their efforts to promote diversity and inclusion in their firms. Stated goals for diverse portfolio company boards, as well as greater assessment of promotion candidates’ track record for promoting diversity and inclusion are among the measures. There are also some interesting initiatives around education and information sharing at both firms. Helander and Edwin explain how 2020 “feels different” and why there’s opportunity in this pandemic-altered moment to create more diverse workplaces – listen here.

Antin’s new deal
Paris-headquartered Antin Infrastructure Partners has raised €1.2 billion to invest in its own portfolio companies, according to sister publication Infrastructure Investor (registration or subscription required).

Backed by secondaries investors, the annex fund will take minority positions in four assets held by 2016-vintage Antin Infrastructure Partners III. It is understood that the assets, three of which are fibre businesses, have grown faster than anticipated and need extra capital for follow-on investments. Evercore managed the process.

A GP-led secondaries process will often involve the creation of a new fund – backed by secondaries investors – into which one or several assets are moved. Antin’s process is unusual, in that the new vehicle will invest alongside existing funds as a minority investor.

Essentials

Fundraisers: a (virtual) visit worth making
South Korean institutional investor The Yellow Umbrella Mutual Aid Fund is planning to expand its private equity portfolio, according to a report in The Korea Economic Daily (paywall). “We have almost zero exposure to global PE, so we need to build a portfolio in that asset class,” CIO Jeong Du-Yeong told the paper. Yellow Umbrella has 11.86 trillion Korean won ($9.9 billion; €8.3 billion) under management.

Carlyle’s new IR head
Carlyle has appointed Nathan Urquhart as its new head of investor relations (paywall), our colleagues at Buyouts are reporting. Urquhart, who joined the firm in February 2019 to head IR for its credit platform, will oversee fundraising campaigns across all investment platforms and run the global IR strategy and team.

IRRked
“The IRR metric is wholly inadequate to perform the function of a fiduciary because it has no concept of risk, which constitutes fully half of the characteristics that fiduciaries are obligated to evaluate,” says Mitch Bollinger, in a LinkedIn post discussing his recent paper IRR: Snake Oil by Another Name.

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Our sister title Regulatory Compliance Watch has launched an anonymous survey to find the best online programmes out there. We’ll share the results in an upcoming issue. To take the survey click here.

Dig deeper

Institution: New York State Common Retirement System
Headquarters: Albany, US
AUM: $216.30 billion
Allocation to alternatives: 19.0%

New York State Common Retirement System has confirmed $297 million-worth of private equity commitments to four vehicles, published in pension’s September 2020 monthly investment disclosure report.

The commitments comprise of £150 million ($194 million; €166 million) to Bridgepoint Development Capital IV, £37.5 million to Wigmore Street/Bridgepoint Development Capital IV Co-Investment, $30 million to PVP Fund III and $24 million to Long Ridge Equity Partners III.

The $216.30 billion US public pension has a 10.0 percent target allocation to private equity that currently stands at 9.40 percent.

The pension fund’s recent commitments are to vehicles focused on the technology, financial services and healthcare sectors within the Europe and North America regions.

For more information on NYSCRF, as well as more than 5,900 other institutions, check out the PEI database.


Today’s letter was prepared by Toby Mitchenall with Adam LeRod JamesCarmela Mendoza and Alex Lynn.

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