USS ‘closely monitoring’ Brexit developments

The pension fund, which has an 11% allocation to private equity, said it will be working with policy makers and regulators to protect the interests of long-term investors.

Universities Superannuation Scheme, a significant UK-based investor in private equity, is keeping a close eye on political and economic developments in the wake of the UK’s decision to leave the European Union last week.

A spokeswoman for the pension said it was too early to speculate on the impact of the referendum vote on private equity as an asset class, but said it “may be significant for our sponsors and our long term outlook as an investor, however it is too early to make judgments.”

“We had taken some steps in anticipation of turbulence and expect considerable further uncertainty for a period,” the statement read.

“We will be closely monitoring developments with regard to the UK Government’s negotiations with Europe as the key issues of relevance to our sponsors and investment approach are determined.”

USS is a pension fund for staff at around 400 universities in Great Britain. It has around £49 billion (€59 billion; $66 billion) in assets under management and an 11.37 percent allocation to private equity, according to PEI Research & Analytics. Funds to which it has committed recently include the €6.75 billion EQT VII and Mayfair Equity Partners I, which is targeting £350 million.

The fund said it would continue to work with policy makers and regulators in the markets in which it invests to make sure the concerns of asset owners and long-term investors are taken into consideration.

“We stand ready to act in the best interests of employers, members and the wider higher education sector as circumstances evolve. Our actions to date have focussed on ensuring that short term market turbulence does not materially impact the scheme’s efficient operation.”

In 2015 USS marketed a $1 billion portfolio of private equity fund stakes, a portion of which was picked up by Paris-headquartered secondaries giant Ardian, as reported by Private Equity International sister publication Secondaries Investor.