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CalPERS Buys Into Silver Lake

CalPERS has agreed to acquire a 9.9% ownership position in tech-focused private equity firm Silver Lake Partners. No financial terms were disclosed, although the New York Times reported a price-tag of approximately $275 million. CalPERS also committed to making additional commitments as a limited partner in Silver Lake funds. Evercore Partners served as financial advisor to Silver Lake on the deal, while Simpson Thacher & Bartlett acted as legal advisor.

 

PRESS RELEASE

Silver Lake, the leader in large private investments in technology, technology-enabled, and related growth industries, announced today that it has entered into a long-term strategic partnership with the California Public Employees' Retirement System (CalPERS) under which CalPERS has acquired a minority ownership stake in Silver Lake.

 

Under the agreement, CalPERS has purchased a 9.9 percent stake in Silver Lake Group and related entities that own and direct Silver Lake and oversee all of its investment activities. CalPERS also has committed to making additional investments as a limited partner in Silver Lake funds. A representative from CalPERS will join Silver Lake's Management Advisory Board.

 

The CalPERS investment provides Silver Lake with a permanent capital base to help the firm continue to generate superior rates of return for its limited partner investors by funding Silver Lake's future growth, strengthening and expanding Silver Lake's global capabilities and footprint, and extending Silver Lake's leadership position in technology investing. The investment also will provide Silver Lake with seed capital for the development of future funds and other new alternative asset business opportunities, as well as expand the ability of Silver Lake to commit to/co-invest alongside its funds.

 

Glenn Hutchins, co-founder and co-chief executive of Silver Lake, said, “The CalPERS investment and strategic partnership with us provide tremendous benefit to Silver Lake and our limited partners by bringing important long-term funding that supports expansion of our technology investment leadership. We are extremely pleased to have this vote of confidence from CalPERS as we focus on building out our successful platform to drive the future growth of Silver Lake and continue creating superior value for our investors. We look forward to taking full advantage of the insight and experience that CalPERS will bring to our firm.”

 

Leon G. Shahinian, Senior Investment Officer of CalPERS Alternative Investment Management Group, said, “CalPERS' commitment to Silver Lake underscores Silver Lake's compelling track record as a leading technology-focused investment firm and a top performer in their fund vintage years. They have consistently demonstrated success in creating value for their investors, and our partnership is a natural progression of a mutually beneficial relationship dating from 1999 when CalPERS was an LP in Silver Lake's first fund. As one of Silver Lake's earliest investors, we are excited to expand our relationship with Silver Lake in a manner that allows us to participate more fully in the firm's continued growth and success as the firm expands its business platform and investment strategy into new markets and geographies.”

 

The firm invests in large-cap technology companies through its Silver Lake Partners funds, the largest private equity funds ever raised for investment in technology, technology-enabled, and related growth industries. The firm recently expanded its investment scope through Silver Lake Sumeru, the firm's middle-market investing strategy, and Silver Lake Financial, the firm's credit investment group. Silver Lake's funds' assets under management are more than $16 billion.

 

Evercore Partners acted as financial advisor and Simpson Thacher & Bartlett as legal advisor to Silver Lake.

 

About Silver Lake

Silver Lake is the leader in large private investments in technology, technology-enabled, and related growth industries. Silver Lake seeks to achieve superior financial returns by investing with the strategic and operating insights of an experienced industry participant. Silver Lake's mission is to function as a value-added partner to the management teams of the world's leading technology franchises. Its portfolio includes or has included technology industry leaders such as Ameritrade, Avago, Avaya, Business Objects, Flextronics, Gartner, Gerson Lehrman Group, Instinet, IPC Systems, MCI, NASDAQ, NetScout, NXP, Sabre Holdings, Seagate Technology, Serena Software, SunGard Data Systems, Thomson and UGS. For more information, please visit www.silverlake.com.

 

About CalPERS

CalPERS is the nation's largest public pension fund with assets totaling more than $250 billion. The System provides retirement and health benefits to more than 1.5 million state and local public employees and their families. For more on CalPERS, please visit www.calpers.ca.gov.