New Hampshire Retirement System, which manages the investments of the state’s retirement system, has reported returns of +1.8% for its private equity portfolio for the year to June 2010. This represents quite a significant turnaround in the performance of its private equity portfolio – for the year to June 2009, it reported returns of -34.1% – with businesses rebounding following the economic crisis reflected in valuations.
The public pension fund has a fairly mature private equity portfolio and had made no new commitments to private equity between 2006 and 2009. It has a long-term allocation of 4% to private equity - currently 1.1% of its USD 5.3 billion assets are invested in private equity. It plans to increase its private equity allocation towards that target and diversify its investments as part of a wider, multi-year review process in place for its alternative investment program.
New Hampshire Retirement System’s private equity strategy allows for the following sub-division of its private equity allocation: 15% to venture capital, 15% to growth equity, 20% to buyouts, 15% to mezzanine, 15% to secondaries, 10% to distressed private equity and 10% to energy or infrastructure. It has a 0% target allocation to special situations, though it has an allowance of up to 10% of it private equity portfolio, at the expense of other strategies, should it desire exposure to this.
In its December investment committee meeting, NHRS was advised by its investment consultant - New England Pension Consultants - that there are attractive opportunities in distressed private equity. It intends to explore opportunities here and generally in mid-market investments.
Further information on private equity investors can be found on Preqin’s Investor Intelligence database.