University of Michigan, Ann Arbor, committed a total of $60 million to three alternative investment funds.
The $9.9 billion UM endowment committed $40 million to Roark Capital Partners IV, a buyout fund managed by Roark Capital Group, which will invest in North American middle-market companies. The fund’s sector focus will be on franchising, consumer products and services, environmental services and business services, said Douglas L. Strong, interim executive vice president and chief financial officer, in materials presented to the board of regents for its Thursdaymeeting.
Additionally, $15 million was committed to Catalyst Fund IV Parallel, a distressed debt fund that will take control of Canadian companies in financial distress that is managed by Catalyst Capital Group.
“Catalyst creates value by restructuring its target companies’ balance sheets in the bankruptcy process and by developing and implementing plans to improve the companies’ operations,” Mr. Strong told regents in his report.
Finally, UM investment staff committed $5 million to Sequoia Capital China Venture Fund V, which will invest in early stage Chinese companies in the information technology, consumer, health-care and clean-technology sectors, Mr. Strong wrote.
At every regents meeting, the university’s CFO informs the board about commitments the investment staff has made to new funds using the same strategy that are offered by existing managers. Regents’ approval is not needed for these commitments.
Separately, UM’s endowment grew by 2.1% in the three months ended Sept. 30, up from $9.7 billion as of June 30, said Mr. Strong and L. Erik Lundberg, the endowment’s chief investment officer, in an asset allocation report prepared for the regents.
