LP Scorecard: Turnarounds Do Well For CalPERS

Turnaround and recovery funds of 2001 and 2002 vintage are the money spinners for the California Public Employees’ Retirement System, as of its private equity performance report to Dec. 31. European-headquartered firms such as Permira Advisers, Clessidra Capital Partners, Advent International and CVC Capital Partners also make up almost half of the top 10 performers for CalPERS for this period.

The largest U.S. pension fund made eight new fund commitments in 2011. The largest of these was a $500 million commitment to private equity behemoth The Blackstone Group’s Blackstone Capital Partners VI LP, followed by a $300 million commitment to Hellman & Friedman Capital Partners VII and $250 million to GSO Capital Opportunities Fund II LP. Other commitments last year focused on special situations with $200 million going to Oaktree Opportunities Fund VIII-B and $150 million going to Avenue Special Situations Fund VI (A) LP.

Distressed and special situations is a recurring theme for CalPERS. Reuters reported in May that the fund will again commit $500 million to a Blackstone-managed fund—Blackstone Tactical Opportunities Separate Account LP. Reuters also reported CalPERS is committing $400 million to Cerberus Institutional Partners V LP, whose investments primarily fall into two categories—distressed private equity and distressed securities, including distressed corporate debt and mortgage investments, according to CalPERS.

CalPERS is also committing $100 million to Credit Suisse-Domestic Emerging Manager LP, which “will invest with Emerging Managers defined as funds raising their first, second, or third-time funds, ” according to Reuters. And another $100 million from CalPERS is slated for Pacific Alliance Group’s PAG Asia I LP.

Those funds that didn’t fare so well for CalPERS during the period also include some of the same big name fund managers that fall into the top ten performers, such as Advent’s 2008 Advent Japan Private Equity Fund LP and the 2006-vintage Carlyle/Riverstone Renew Energy Infrastructure. Others that could do better include NGEN Partners’ 2005 vintage NGEN II LP and Apollo Global Management’s 2007 European offering AP Investment Europe Ltd.