New Jersey Commits To Hedge Fund, Private Equity Managers

Mar 19 2007 | 11:07am ET

The New Jersey Division of Investment is expanding its investments in alternatives, making a direct investment of $75 million in the Canyon Value Realization Fund and a $100 million commitment to Black River Multi-Strategy Leveraged Fund. In addition to the two hedge funds, the system is also committing a total of $425 million to four private equity funds.

New Jersey has committed $100 million to Court Square Capital Partners II, $25 million to InterMedia Partners VII, $200 million to a separate account managed by Goldman Sachs and $100 million to a separate account managed by Lehman Brothers.

The Canyon Fund has posted annualized return of 11.94% with a 7.06% standard deviation since inception, according to the Canyon Capital Partners, which manages $12.5 billion, $8.3 billion of which is in hedge funds. Black River employs 15 different strategies including fixed-income relative value, convertible bonds and derivatives and commodities, and has enjoyed an annualized net return of 12.38% since inception.

The four p.e. mandates give the system geographical diversification within its portfolio: Court Square and InterMedia Partners focus on the domestic middle-market buyout sector. The Goldman mandate gives the system a presence in the European middle-market buyout scene, while Lehman is charged with constructing a diversified portfolio of funds and direct investments that are either headquartered in New Jersey or have significant operations in the state.

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