By Muskan Arora
The $54.2bn
New Mexico State Investment Council committed approximately $830m to new allocations
within its private market sleeve.
In the meeting, the CIO Vince Smith highlighted economic statistics showing volatility including “job numbers remained strong, but there were emerging signs of weakness in the housing market, and consumer credit was exhibiting signs of ‘toppiness’”.
Private equity
commitments
Out of the
total commitments, the system made approx. $530m allocation to its private
equity sleeve.
The system
approved an allocation of $150m to Frazier Healthcare Growth Buyout Fund XI
and $150m to side-by-side co-investment vehicles, as presented by Chris
Cassidy, Bruce Brown and Richard Pugmire from Mercer.
The growth
fund is focused on middle market companies in the healthcare sector, alongside
partnering with founders, family offices and management teams to build
market-leading healthcare companies.
SIC will split
its previous $100m commitment to Frontier Fund I into two new
commitments of $50m each to Roadrunner Fund I and Frontier Fund I Alpha.
The Roadrunner
fund will continue to invest in early-stage companies while providing hands-on support
to founders, filling gaps in capital, resources, talent, and helping translate
technologies into viable commercial products.
Roadrunner is
a venture studio created to promote tech transfer and commercialization,
helping translate scientific knowledge and technologies into new companies.
The system
along with consultant Mercer approved a commitment of $30m to Outlander 3
Magellan, venture capital fund that focuses on the pre-seed and seed stage
investments.
The fund
has a major focus on investing in New Mexico, and other regions that have “untapped
talent and potential, but lacking access to the necessary risky capital”.
Further,
the system committed $100m to Veritas Capital Fund IX, a buyout strategy
focused on investing in products, software, technology, and services to
government and commercial consumers globally.
Additionally,
the system also approved $100m to a side-by-side co-investment vehicle to be
managed by Veritas.
Veritas invests
across sectors such as healthcare, government services, aerospace and defense,
and technology, aiming to create long-term value for investors through
strategic investments and value creation initiative.
Real
assets and private credit commitments
Within the
private credit sleeve, the system with consultant Meketa, committed $150m to Pemberton
Strategic Credit Fund IV Strategic Credit Fund IV.
The strategic
credit fund (SCF) strategy focuses primarily on senior and subordinated loans
to performing Western European mid-market companies but will have the
optionality to invest across the capital structure including junior capital and
equity investments.
SCF IV will
look to invest opportunistically in cases of lender stress and in market
dislocations.
For its
real assets sleeve, the system committed up to $150m to Hull Street Energy
Partners III, which will majorly focus on investments in renewables.
“The market
for mid-market power and utilities assets is fragmented,” as per the recent
meeting materials.
A key focus
of the strategy is acquiring operating power plants, typically those it
identifies as having been under-managed or which possess other attractive
attributes.
