Los Angeles City Employees’ Retirement System committed up to $25 million to private equity fund Bain Capital Asia Fund III and up to $20 million to private equity fund Harvest Partners VII, the agenda for the $14.4 billion pension fund board’s Nov. 24 meeting shows.
Bain Capital Asia Fund III is a targeted $2.5 billion buyout strategy managed by Bain Capital Partners that is expected to invest in middle-market companies primarily based in China, Japan, India and Australia. The fund’s life is 10 years, plus three one-year extensions at Bain Capital’s discretion. The management fee is 2% of total commitments per year during the investment period, reducing to 1.5% per year after capital has been invested. There is a 20% carried interest after a 7% preferred return hurdle. This is a new relationship for LACERS.
Harvest Partners VII is a buyout fund with a $1.5 billion target. The fund has a 10-year life plus a one-year extension at Harvest Partners’ discretion and two additional one-year extensions with the approval of the board of advisers. The fund’s management fee is 2% of total commitments per year during the investment period and 1.75% per year after the committed capital has been invested. Carried interest is 20% after an 8% preferred return hurdle.
Both commitments were made through a discretionary mandate with LACERS’ private equity consultant, Portfolio Advisors.
Separately, Attucks Asset Management on Nov. 9 resigned its contract managing a $41.6 million domestic small-cap emerging managers fund of funds, minutes for LACERS’ Nov. 10 board meeting show. The LACERS board was scheduled to decide whether to let Attucks’ contract expire on Nov. 30. Attucks’ assets will be placed in a passive small-cap core equity portfolio managed by RhumbLine Advisers, pending a search for an active domestic small-cap emerging managers fund of funds in 2016. RhumbLine managed $102 million in that Russell 2000 portfolio as of June 30.