The board, which oversees the state’s $84.2 billion retirement system, pledged $400 million to First Reserve Fund XIII, which is targeting $6 billion. The system began its relationship in 1998 and has committed a total of about $1 billion across five prior funds, according to a spokesperson for the board.
Washington State also began a new relationship with TowerBrook, committing $300 million to the firm’s Fund IV, targeting $3 billion. The firm generally focuses on the consumer, industrials, communications, logistics and business and financial services sectors.
The system formed a second new relationship with Riverside, committing $150 million to the Riverside Capital Appreciation Fund VI, which is targeting $1 billion for North American mid-market buyouts. Fund VI will focus on companies with enterprise values between $50 million and $150 million and target healthy companies in rapidly growing markets.
Many limited partners have backed off from forming new relationships as they consolidate their portfolios and direct more capital to their most favoured managers. Washington State is one of institutional investor that has kept up with building new relationships. In September, the board announced that it has made a $150 million debut commitment to Roark Capital Group, which is targeting $1.25 billion for its third fund targeting investments in mid-market franchising, consumer products and services, environmental services and business services companies.
Washington State has about $40 billion in total commitments to private equity and venture capital, with total paid-in capital of about $32 billion. The full portfolio was generating a 13.02 percent internal rate of return as of 30 June, according to the board’s web site.