Wellington Management, one of the nine firms chosen in July to participate in the Treasury Department’s toxic asset program (PPIP), is expected to close its related fund today, according to an investor. The firm had been targeting $1.1 billion and has said privately that it should be fully subscribed.
This news comes just one day after Treasury announced the first two interim fund closings, from Invesco Ltd. and The TCW Group. No specific financial information for either fund was disclosed, except that each interim close was for more than $500 million in capital commitments.
One interesting note from the Wellington investor is that these fundraisings are very different from typical private equity fundraisings, in that there is very little room for negotiation. “The government is basically an even partner, and it’s set the ground rules,” our source says. “It’s mostly take it or leave it.”
A Wellington Management spokeswoman declined to comment.
Let me also take this chance to reiterate my continued frustration with the Treasury Department’s refusal to release the names of 90+ firms whose PPIP applications were rejected.
In its July announcement, Treasury said that “over 100 unique applications… were received” — in an apparent effort to show how popular the program was among private investors. Unfortunately, we have no idea if those rejected applications came from legitimate institutions or from snake-oil salesmen, thus calling into question the aforementioned popularity.
We asked Treasury nicely for the names, but were told to get lost. We then filed a Freedom of Information Act request, and were again denied. We appealed, and then denied again. Since there is no trade secret at stake — nor any significant reputational damage in losing a deal (which has happened to all investment firms), there is little reason for such secrecy. Unless, of course, Geithner has been polishing his shoes with a recently-received carton of snake oil…