CalPERS extends in move into private equities

Feb. 1, 2001 (PLANSPONSOR.COM)-The $170 billion CalPERS continued its move into the private equity arena, committing $425 million in a strategic relationship with the Carlyle Group, a huge global private equity firm.

The nation’s largest public pension system said its initial investment will consist of:

  • a $250 million investment in various new Carlyle private equity funds; and
  • a $175 million investment for a minority equity stake in The Carlyle Group.

Over the next two years, CalPERS has an option to invest an additional $425 million as part of the relationship with Carlyle.

Week’s Worth

Earlier this week, the huge California fund announced it had taken a $485 million equity stake in TPG Ventures, a subsidiary of San Francisco-based Texas Pacific Group.

Until today?s announcement, the TPG deal was the most recent investment made by CalPERS Alternative Investment Management program. The System has more than $16 billion invested or committed for investment in the private equity arena.

CalPERS began its investment relationship with Carlyle in April 1996 with an $80 million investment in Carlyle Partners II, L.P., and later made a $150 million investment in Carlyle Partners III, L.P. in June 2000. William D. Crist, President of CalPERS Board of Administration, said the fund was “very pleased with the firm?s performance.”

The Carlyle Group, based in Washington, D.C., has offices around the world and manages over $12.5 billion of private equity capital in 14 active buyout, venture, real estate, high-yield, and energy funds.

Chuck Epstein