Ontario Municipal Employees Retirement System, Toronto, sold a portfolio of 11 private equity buyout funds with a total of about US$850 million in original commitments to AXA Private Equity, confirmed Paul Renaud, president and CEO of OMERS Private Equity, a unit of the C$55 billion (US$54.3 billion) pension fund.
Terms were not disclosed.
The move is a result of OMERS transitioning to direct investments from limited partnerships, Mr. Renaud said in a telephone interview. OMERS started acquiring majority ownership positions in 2006 and expanded the program in 2008. Direct investments now make up 57% of the C$6.5 billion private equity portfolio. This is the largest transaction on the secondary market for OMERS, Mr. Renaud said.
“We've been on this path for quite a few years now,” Mr. Renaud said. “Our preference is to acquire the business ourselves and manage it ourselves.”
Most of the commitments in the deal date back to funds launched from 2005 to 2007. The goal is to have direct investments make up more than 80% of the portfolio, but OMERS is “opportunistically selling funds” because Mr. Renaud said they made good investments in the past and are not rushing to get rid of them.
The move follows two large acquisitions by AXA Private Equity in 2011 — a US$1.7 billion acquisition of private equity assets from Citigroup and US$740 million acquisition of private equity assets from Barclays.