New Jersey To Allocate $950 Million To Hedge Funds, Private Equity

Apr 23 2007 | 1:04pm ET

The New Jersey Division of Investment has recommended a handful of managers to handle new hedge fund and private equity allocations. 

The pension system is aiming to allocate a total of $625 million to two funds of hedge funds and three single-strategy managers, and a total of $325 million to four private equity funds, according to a due diligence memo penned by director William Clark to the system’s investment council.

The Garden State is to proposing an investment of $100 million each in two Blackstone funds of funds strategies: Pacific Opportunities Strategy and an Emerging Markets Strategy.

The system is also looking to make a $150 million commitment to a fund of funds to be managed by Protégé Partners, which was founded by Jeffrey Tarrant and Ted Siedes in July 2002. The New York-based firm currently manages $2.2 billion and invests in smaller, niche funds and also seeds managers. Protégé targets 50% of investments in directional, 25% in relative value and 25% in event driven managers worldwide.

New Jersey’s proposed direct investments in single-strategy managers include a $75 million commitment to the Ascend Partners Fund II, which is a 1.5x levered version of the firm’s fundamental equity long/short strategy.

The pension system is also allocating $150 million to Farallon Capital Institutional Partners, a multi-strategy fund, and $50 million to Omega Overseas Partners Ltd Class B, a long/short equity fund. 

On the private equity front, the system is making a $100 million commitment to Avenue Special Situations Fund V and a $50 million commitment to KPS Special Situations Fund III. Both funds focus on U.S. stressed and distressed opportunities.

Finally, a $100 million commitment is being made to MatlinPatterson Global Opportunities Partners, a global distressed fund, and a $75 million commitment to Thomas H. Lee Equity Partners VI, a growth-oriented buyout fund.


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