Saturday, 28 May 2016
Last updated 5 hours ago
Mar 27 2014 | 11:20am ET
A group of public pension funds, led by California’s Orange County Employees Retirement System, are joining forces to lower the cost of their private-equity investments.
OCERS, which manages $11.5 billion, this week hired Pantheon Ventures to run the p.e. pool, which will be open to smaller retirement plans. The pension hopes that, as a group, the plans will have the weight to win fee reductions from private equity managers.
“We’ve demonstrated the effectiveness of collective purchasing and economies of scale,” OCERS chief investment officer Girard Millar told Bloomberg News. The program could save OCERS, which will invest $50 million to $100 million in each of three years, about $5 million in fees alone.
Others plans looking to join the group include those of neighboring San Bernardino County and the state of Wyoming. Those systems that commit before September will be eligible for a discount.