BlackRock suspends new deals from long-term PE fund after Wiseman’s departure

The firm will need LP approval to continue investing from the vehicle, which has thus far collected $2.75bn against a target of up to $12bn.

BlackRock has been forced to suspend all new deal activity from its Long Term Private Capital Fund following the termination of global head of equities and chairman of the firm’s alternative investment unit Mark Wiseman.

Wiseman was ousted from the firm for failing to disclose a workplace relationship.

BlackRock is in market with its Long Term Private Capital fund, which is seeking as much as $12 billion and will have the capacity to hold companies “up to forever”, Wiseman told Institutional Investor in May. At least $2.75 billion has been raised for the vehicle so far, according to PEI data.

The firm will need to seek permission from the fund’s LPs to continue investing, BlackRock confirmed to sister publication Private Equity International.

News of the firm suspending investment from the fund was first reported by the Wall Street Journal.

Investors in the Long Term Private Capital fund include the Minnesota State Board of Investment, which committed $1 billion, and Wyoming State Loan and Investment Board, which committed $200 million, according to PEI data.

The vehicle made its first investment in August, acquiring an $875 million stake in US-based entertainment company Authentic Brands Group.

Global head of long term private capital André Bourbonnais continues in his role, leading the 20-person investment team and running the strategy day-to-day, and will continue to report to Edwin Conway, global head of BlackRock Alternative Investors, a BlackRock spokeswoman told PEI in an email.

Firm president Robert Kapito is replacing Wiseman as chairman of Long Term Private Capital, a role that did not have any investment responsibilities or personnel management duties, but was “a means for Mark to contribute to BAI in addition to his other responsibilities leading active equities”, the email said.

“The fact that the president and co-founder of the firm is stepping into this role reflects the firm’s commitment to and conviction about this strategy, which we think meets an unmet need for clients.”

In addition, Tom Donilon, chairman of the BlackRock Investment Institute, will also serve as an additional executive sponsor for LTPC.

“Tom will work closely with André and team to ensure that we are leveraging the full strength of BlackRock to support the continued success of the fund,” the spokeswoman said in the email.

In July 2018 BlackRock hired Goldman Sachs Asset Management managing directors Steve Lessar and Konnin Tam to lead a push into the secondaries market. The firm’s debut fund is set to come to market in 2020 with a target of $1.5 billionSecondaries Investor reported.

Wiseman announced his departure in an internal memo to BlackRock staff, writing that in recent months he “engaged in a consensual relationship with one of our colleagues without reporting it as required by BlackRock’s Relationships at Work Policy”.

“I regret my mistake and I accept responsibility for my actions.”

Wiseman added he is “committed to doing everything I can to ensure an orderly transition”.

In a separate memo, chief executive Laurence Fink and Kapito wrote there are “no changes in our alternatives business”, with global head of BAI Conway and BAI chief investment officer Jim Barry continuing to “oversee all aspects of the business”.