NYC Euro Investments are a Mixed Bag

European buyout funds within four of the New York City pension fund portfolios have a mixed performance ranging from an IRR low of -29.10% to a high of 41.8% according to the most recent fund performance reports.

As of 31/09/2011 NYCERS (NYC Employees’ Retirement System) generated an IRR of 8% and investment multiple of 1.24x on a private equity portfolio value of $3.2 billion. TRS (Teachers’ Retirement System City of New York) generated an IRR of 9.38% and a multiple of 1.3x on a portfolio value of $2.1 billion, as of 30/06/2011. NYC Police Pension Fund generated an IRR of 9.5% and multiple of 1.28x on a value of $1.7 billion as of 31/09/2011 and NYC Fire Department Pension Fund for the same period generated an IRR of 10% and multiple of 1.3x on a value of $505 million.

NYCERS, TRS, NYC Police and NYC Fire all made commitments to the same European buyout-related funds in 2011. These included AXA Secondary Fund V B L.P, BC European Capital IX and EQT VI, L.P.

NYCERS, NYC Fire and NYC Police all placed their bets on Terra Firma’s 2006 vintage Terra Firma Capital Partners III which reported the lowest IRR of the European funds of -29.10. That fund closed in June 2007 with approximately 5.4 billion euros ($6.9 billion) of investor commitments. The closing of the fund coincided with the announcement of the firm’s ill-fated 4.2 billion pounds ($6.7 billion) takeover of music business EMI in 2007 which suggests the rest of the fund managed an impressive performance turnaround as around 30% was written off on that one deal.

Here is a slideshow of the top performing European buyout funds within the four New York City pension funds. Positive IRRs within this top 10 only come to the fore from number 7. NYC Fire and NYC Police were both fortunate to have committed to the 2001 vintage European buyout fund which comes out top with an impressive 41.8% IRR, while TRS and NYCERS both missed out on that top performer. Bridgepoint and Cinven are the two European buyout houses that seem to be in favour with all four pension funds. Scroll down to find out more.

[slideshow]

[slide title=”No.10 – Euro Choice III (Scotland)”]

IRR: -4.30%
Multiple: 0.92x
Vintage: 2006
Pensions in Fund: NYC Police, NYC Fire
Combined Capital Commitment: $32.5 million

[slide title=”No.9 – Bridgepoint Europe IV”]

IRR: -3.60%
Multiple: 0.96x
Vintage: 2008
Pensions In Fund: NYC Police, NYC Fire, NYC Employees, NYC Teachers’ Retirement of NYC
Combined Capital Committed: $76 million

[slide title=”No.8 – Permira IV, L.P.”]
IRR: -0.70%
Multiple: 0.98x
Vintage: 2006
Pensions In Fund: NYC Police, NYC Fire
Combined Capital Committed: $21.7 million

[slide title=”No.7 – Bridgepoint Europe III”]

IRR: 2.50%
Multiple: 1.10x
Vintage: 2005
Pensions In Fund: NYC Police, NYC Fire, NYC Employees, NYC Teachers’ Retirement of NYC
Combined Capital Committed: $53.3 million

[slide title=”No.6 – Euro Choice II (Delaware) (fka LODH Private Equity – Euro Choice II)”]

IRR: 5.80%
Multiple: 1.23x
Vintage: 2004
Pensions In Fund: NYC Police, NYC Fire
Combined Capital Committed: $27.1 million

[slide title=”No.5 – The Fourth Cinven Fund”]

IRR: 6.00%
Multiple: 1.23x
Vintage: 2006
Pensions In Fund: NYC Police, NYC Fire, NYC Employees, NYC Teachers’ Retirement of NYC
Combined Capital Committed: $135.3 million

[slide title=”No.4 – CVC European Equity Partners V, L.P.”]

IRR: 7.90%
Multiple: 1.12x
Vintage: 2008
Pensions In Fund: NYC Police, NYC Fire
Combined Capital Committed: $48.1 million

[slide title=”No.3 – Coller International Partners V, L.P.”]

IRR: 8.70%
Multiple: 1.20x
Vintage: 2006
Pensions In Fund: NYC Police, NYC Fire
Combined Capital Committed: $15 million

[slide title=”No.2 – Coller International Partners IV, L.P.”]

IRR: 15.80%
Multiple: 1.47x
Vintage: 2002
Pensions In Fund: NYC Police, NYC Teachers
Combined Capital Committed: $65 million

[slide title=”No.1 – CVC European Equity Partners III, L.P.”]

IRR: 41.80%
Multiple: 2.96x
Vintage: 2001
Pensions In Fund: NYC Fire Department, NYC Police
Combined Capital Committed: $35 million

[/slideshow]

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