Maryland State Retirement & Pension System (Maryland) has committed about $205 million to Asia-focused vehicles in the fourth quarter of 2018, as confirmed by the pension fund to DEALSTREETASIA.
The fund put in some $100 million into Bain Capital’s fourth Asia fund, Bain Capital Asia Fund IV. The fund is said to have closed last December at $4.65 billion, according to a Reuters report. The fund’s predecessor raised $3 billion in 2016 and saw a 60.9 per cent internal rate of return by June 2018, said a public investment memorandum of Pennsylvania Public School Employees’ Retirement System (PSERS), one of the fund’s LPs.
Besides Bain Capital, Maryland also committed $75 million into Hong Kong-based PAG’s third Asia buyout fund, PAG Asia III. The fund was closed last November at $6 billion after it was oversubscribed.
Another Asia-focused fund, India-based ChrysCapital has received $30 million worth of commitments from Maryland for its seventh fund. The firm has recently closed its eighth fund at $850 million, bringing its total AUM to more than $4 billion.
ChrysCapital is also backed by New York State Teachers’ Retirement System, which committed $75 million into the firm’s eighth fund.
As Western pension funds are turning to Asia for private equity investments, most of them have chosen to go with global firms that have track record in Asia-focused investments.
For instance, this is not the first time that PAG has received backing from US pension funds. PAG Asia III has received commitments from San Francisco Employees Retirement System (SFERS), which approved a $50 million check for the fund.
Another US pension fund California Public Employees’ Retirement System (CalPERS) has also committed $380 million to PAG Asia III. PAG is currently on the road to raise up to $1 billion for its third special situations fund, backed by Texas Permanent School Fund, which agreed to make a capital commitment of up to $75 million to the fund.
Similarly, CalPERS has also backed global PE firm TPG’s latest Asian fund, TPG Capital Asia VII, with a commitment of $300 million. The fund held its final close at $4.6 billion last week two years after securing its first commitment – a $100 million check from the New Mexico State Investment Council (SIC) — in January 2017.
Besides SIC and CalPERS, other US pension funds that have committed to TPG Asia VII include the Employees Retirement System of Texas ($100 million) and the Teacher Retirement System of Texas ($150 million).
Hong Kong-based Baring Private Equity Asia, which is raising up to $6 billion for its seventh fund, has achieved a first close at $4.5 billion. The fund received the backing of Texas Employees Retirement System ($15 million), Los Angeles Fire & Police Pension System ($25 million) and Los Angeles City Employees’ Retirement System.