National Employment Savings Trust, London, hired HarbourVest Partners to invest directly in private equity.
It is the £24 billion ($28.5 billion) defined contribution multiemployer plan's second private equity partnership, following a similar one announced in May with Schroders Capital.
The two private equity mandates conclude a procurement process initiated in 2021, according to a NEST spokesman. The plan is to invest at least £1.5 billion in private equity by early 2025, with a longer-term target of roughly 5% of the NEST portfolio.
HarbourVest Partners will invest in co-investment opportunities on NEST's behalf through a bespoke fund-of-one that will have a pro-rata allocation of co-investment opportunities long with other co-investment accounts. HarbourVest had $98 billion of assets under management as of March 31.
The HarbourVest Partners mandate will focus on growth and middle-market deals, with capital deployment expected to start within months.
Stephen O'Neill, head of private markets for NEST, said in a news release that HarbourVest Partners "impressed with their ability to unlock private equity deals around the world. They have an impressive scale to help provide a reliable and regular deal flow, allowing them to be highly selective in the deals they choose."
They also "understand the importance of responsible investing," and exercise their governance rights to help manage long-term risks and encourage sustainable business activities, Mr. O'Neill said.
The private equity investments will be available in NEST's existing default "retirement date" funds. NEST participants will see no change in charges, the spokesman said.
Adding private equity completes NEST's private markets strategy, which includes property, private credit and infrastructure, and will represent roughly one-fifth of its portfolio, the spokesman said.