Ardian purchases portfolio from Ontario Teachers

OTPP's portfolio of PE fund stakes included at least six different European vehicles, from managers including BC Partners and EQT.

Ardian has purchased a portfolio of fund stakes from Ontario Teachers’ Pension Plan (OTPP) through its ASF Lake fund, according to UK regulatory filings. The portfolio was made up of at least six different funds and its total size was undisclosed.

The fund of funds acquired 50 percent of the Canadian pension’s interest in BC European Capital IX-6 and another 50 percent of OTPP’s stake in BC European Capital IX-8, according to a filing from 6 May. BC European Capital IX was raised in 2011 and closed on €6.68 billion, according to PEI Research & Analytics.

As of 31 March 2015, the fund, which is only 5 years old, was generating a 1.06 percent internal rate of return, according to documents from the California State Teachers’ Retirement System. The fund’s investor base includes British Columbia Investment Management Corporation, Canada Pension Plan Investment Board, Columbia University and MetLife, who all re-upped from its predecessor, according to PEI Research & Analytics.

Ardian also bought half the stakes owned by OTPP’s Classroom Investments in BC European Capital VIII-4, half in BC European Capital VIII-5 and half in BC European Capital VIII-6. BC Partners’ eighth European fund was raised in 2008 and closed on €5.88 billion with commitments from LPs partners such as Idinvest Partners, Amherst College, Ford Foundation and Kroger Company. As of 30 June, the fund was generating 4.39 percent net IRR, according to documents from Washington State Investment Board.

Stakes held by OTPP through its Roncesvalles Investments vehicle in two separate EQT funds were also part of the portfolio sale. The funds are EQT V, a vehicle that was raised in 2006 and closed on €4.25 billion, and of EQT VI, a €4.82 billion vehicle raised in 2011, according to PEI data. The pension sold the entirety of these stakes.

Investors in those EQT funds include Danish pension Pensionskassen for Sundhedsfaglige, Andrew Mellon Foundation, Capital Dynamics, AlpInvest Partners and Prudential Financial, according to PEI Research & Analytics. IRR data for these funds were not available.

The Paris-based fund of funds also acquired 100 percent of OTPP’s interests in Phoenix Equity Partners 2006 and Phoenix Equity Partners 2010.

The 2006 fund closed in 2006 on £375 million ($652.2 million; €484.2 million). It has six remaining assets that it invested in between 2006 and 2010. Those current investments are automotive parts distributor Andrew Page, niche asset rental company Ashtead Technology, restaurant operator Busaba Eathai, retailer LK Bennett, sportswear company Musto, and handbags and accessories company Radley, according to its website. The 2010 fund closed on £450 million six years ago.

LPs in the Phoenix 2006 and 2010 funds include Colorado Public Employees’ Retirement Association, AlpInvest Partners, SEB Asset Management, The Wellcome Trust, Compagnia di San Paolo, Adams Street Partners and now Ardian, according to PEI Research & Analytics. Information on their IRR performance was not available.

Ardian declined to comment.

OTPP was not available to comment.