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Public markets volatility leaks into secondaries pricing, Apollo agrees to acquire Tenneco

CalPERS hires Nicole Musicco as CIO,

Morning!

This is Chris, on the Wire this morning …

What have you seen out there?? The big trends we’re following so far this year – fundraising remains at a frantic pace, M&A is strong, credit is easy, terms are GP-friendly, secondaries continues to run at a strong pace and the SEC may be coming down hard on the industry in a way we’ve never seen.

Pricing in secondaries is starting to be impacted by the volatility in the public markets, sources have told me over the past few weeks. This is affecting both traditional LP portfolios and conceived GP-led deals, though it doesn’t seem yet that any deals have had to be repriced or even pulled because of pricing. What have you’ve seen? Hit me up at cwitkowsky@buyoutsinsider.com.

“If you’re pricing off of 9/30, the market is different now, so the question becomes, ‘do we need to roll forward and reprice?’,” a secondaries adviser told me. “People on the LP side are saying, ‘what do I expect March marks to be rather than December?”

Portfolio sale: Speaking of secondaries, here’s a story about a fairly quiet process in which Pictet Group sold a $900 million-plus portfolio of mostly high-quality funds. Blackstone’s Strategic Partners was the buyer (not clear if the firm was the only buyer).

Greenhill & Co. worked as secondary adviser on the sale, which included funds from Carlyle, Blackstone, Vista, CD&R, Platinum Equity, AEA Investors, Audax, Apollo Global Management and Thoma Bravo. Read more here on Buyouts.

New leader: CalPERS’s hiring of Nicole Musicco as CIO was significant for private equity, as Musicco joins the system after a career working in the asset class, including most recently at RedBird Capital Partners.

CalPERS has committed to growing its private equity program over the next few years, as late last year it jacked its allocation target to 13 percent of total assets, from 8 percent. The system, with $500 billion in assets under management, committed $12.3 billion to private equity last year. It plans to continue its aggressive pace this year.

Bringing on a leader with a history of private equity experience is no coincidence, according to Megan White, a spokesperson for CalPERS. Prior to RedBird, Musicco managed the private markets investment program at the Investment Management Corp of Ontario. She also worked for 16 years at Ontario Teachers’ Pension Plan, leading private and public equity investment teams.

“Her PE experience and our investment strategy, which includes increasing the allocation to PE and focusing on increasing coinvestments, make her [an] excellent choice for our next CIO,” White said.

That’s it for me! Have a great rest of your day. Hit me up, as always, with tips n’ gossip, feedback or just your thoughts at cwitkowsky@buyoutsinsider.com or find me on LinkedIn.