P.E. Firms Fight Freedom Of Information Requests

Nov 5 2014 | 10:21am ET

Public pension funds have been a boon for private-equity firms, pouring billions into the industry in recent years. But some of the biggest p.e. firms are blanching at the transparency that such public investments can bring—and they are fighting back against it.

Public pensions have received public-records requests for documents covering their relationships with p.e. firms, notably about fees. But p.e. firms have been largely successful in avoiding such revelations, through lobbying and threats.

Just last month, Kohlberg Kravis Roberts warned the Iowa Public Employees’ Retirement System against complying with a request seeking information about the fees it paid. The firm said that the release of confidential information could “jeopardize access to attractive investment opportunities;” in effect, a threat to refuse IPERS’ business in the future.

Iowa acceded to KKR’s demands, releasing a version of the requested document with redactions sought by the p.e. firm.

KKR defended its actions in the Iowa case, telling The Wall Street Journal that confidentiality enables it to disclose more information to clients.

Other state pensions have also refused to release such information, including North Carolina and Florida. Washington’s main public pension fund said a June survey of its p.e. managers indicated overwhelming unwillingness to release information.

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