By Muskan Arora
The $74.6bn Pennsylvania Public School
Employees’ Retirement System commits a total allocation of $225m to its private
equity sleeve.
The system has $210m dry powder left to
allocate for the remaining year and may have “one or two recommendations between
August and end of the year”.
For the quarter, private equity returned
2.12% on a one-quarter lag. The system allocates 16.5% to private equity, as of
March 31.
“For both technology and healthcare, it all
comes down to earnings, and long-term trends appear supportive,” stated J.P.
Morgan in its recent market outlook.
First commitment proposed by Luke M. Jacobs, portfolio manager at PSERS is $125m to
LLR Equity Partners VII.
LLR seeks to make investments within the US
with a focus on lower middle market growth companies specifically in healthcare
and technology sectors.
The fund will be diversified between 20-25
companies, with an average investment range of $50m to $100m.
“Technology has already emerged from its
own earnings recession, and we expect the sector to generate mid-teens earnings
growth through 2025,” added the J.P. Morgan research.
As of September 30, 2023, PSERS committed
$919m across LLR’s six funds.
Second commitment proposed by Melissa A Quackenbush, senior portfolio manager
alongside Jacobs is $100m to Summit Partners Growth Equity Fund XII.
Summit Partners seeks to make investments
in 25-35 high growth companies situated in North America with a focus on
technology, healthcare and life sciences alongside growth products and services
sectors.
“We do invest in technologies or software that
are related to the healthcare industry, but we also invest in healthcare
services companies. These could be providers of healthcare,” said Scott Collins,
partner at Summit Partners.
“We have both service provider, healthcare
providers, as well as technology and healthcare related equipment and
instruments. We do not invest typically in hospitals,” Collins added.
The fund is keen on growth buyouts and ‘buy
and build’ investments.
As of December 2023, PSERS committed $595m
across six Summit funds and one co-investment generating a net IRR of 24.8%.