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CalPERS commits EUR400m private equity mandate to SLI

Standard Life Investments (Private Equity) has been selected by California Public Employees Retirement System to manage a mandate valued at EUR400m euros for its alternative investment man

Standard Life Investments (Private Equity) has been selected by California Public Employees Retirement System to manage a mandate valued at EUR400m euros for its alternative investment management programme. The mandate is focused exclusively on European private equity and will be managed in a fund called ESP Golden Bear Europe Fund.

‘We are delighted to have been selected for this mandate by CalPERS, the largest public pension fund in the US,’ says SLIPE chief executive David Currie. ‘This is testimony to the expertise and professionalism of our private equity team and our strong track record in the European private equity market.

‘This is our fourth major segregated mandate from a North American client; over 50 per cent of our assets under management are now from North America. We expect the ESP Golden Bear Europe Fund to shortly start making commitments to European private equity funds and we are looking to create a strong co-investment portfolio.’

CalPERS chief investment officer Russell Read says: ‘Our new partner offers us unique access to the premier managers and co-investment opportunities in Europe, leveraging SLIPE’s strong relationships and proven track record. ‘We have a particular need for a partner who will focus exclusively on small to middle-market European private equity.’

CalPERS is the largest public pension fund in the US with just over USD245bn in assets. The organisation provides retirement and health benefits to approximately 1.5 million state employees, retirees and their families and more than 2,500 employers. Investments span domestic and international markets.

CalPERS has recently been refocusing on core direct relationships with a number of funds, while engaging new vehicles, including fund of funds, to pursue global opportunities at the smaller end of the market. ESP Golden Bear Europe Fund is the latest of five new alternative investment management ventures in the past 18 months.

The others are Hamilton Lane, which targets investments in underserved Californian markets, Centinela Capital Partners, a fund of funds focusing on emerging managers, Sacramento Private Equity Partners, which invests in venture capital and smaller middle market private equity funds in the US, and Asia Alternatives, focusing on smaller to middle market funds in Asia.

SLIPE is headquartered in Edinburgh and has an office in Boston, Massachusetts. The firm provides both European and US private equity fund of funds services to clients from 24 countries and has raised more than USD7bn for its funds. SLIPE was recently globally ranked as the sixth largest manager of private equity fund of funds for pension plans by Watson Wyatt.

Standard Life Investments recently announced that on October 1 it would launch a new vehicle, SL Capital Partners, into which the business of SLIPE and the general partner companies that manage SLIPE funds will be transferred.

Standard Life Investments will retain 100 per cent of the capital value of the business transferred and be entitled to 60 per cent of the future economic returns and 60 per cent of the voting rights of SL Capital Partners. Senior members of the private equity management team will hold the remaining 40 per cent.

With assets under management of GBP140.6bn, Standard Life Investments is one of the UK’s major investment houses and controlled around 1.9 per cent of the UK stock market at the end of March. Launched in 1998 as a wholly owned subsidiary of insurer Standard Life, the firm operates in the UK, Canada, Ireland, Hong Kong and the US, has representative offices in Germany and South Korea, and operates in India through a joint venture.

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