British Columbia IMC offloaded large LP portfolio last year

The sale by Canada’s fourth-largest pension comes as it pivots to direct deals and invested a record amount in private equity in the 2019-20 financial year.

British Columbia Investment Management Corporation, Canada’s fourth-largest pension manager, sold LP stakes worth many hundreds of millions of dollars in its last financial year.

The Victoria-headquartered institution completed “10 private equity fund sales” worth C$800 million ($610.2 million; €513.5 million) in the year to end-March, according to its latest annual report.

“The decision to sell is based on the fundamental analysis of underlying portfolio companies, holding periods, and expected realisation values,” the report noted.

It is unclear whether BCIMC sold the stakes in one sale or in separate transactions.

A spokeswoman for the pension declined to provide further details of the sale, citing confidentiality provisions and the terms of the agreement.

Sister publication Buyouts reported in June 2019 that BCIMC was selling a portfolio of private equity fund stakes valued between $250 million and $500 million and that the pension system was not using an advisor on the deal.

The pension had sold 20 fund investments in the 2017-18 financial year that it no longer considered aligned with its strategy, according to its annual report.

The C$171.3 billion institution invested C$5.3 billion in the private equity market last year, a record amount driven in part by a strategic push toward direct deals. The pension’s goal is to split its private equity portfolio roughly evenly between directs and funds.

The pension, which is aiming for more exposure to direct deals, still commits most of its capital to funds. In the year to March it pledged C$3.7 billion to 18 new and core fund relationships, up 23 percent from 2018.

Public pensions were the second-most active sellers on the secondaries market last year after financial institutions and insurance companies, accounting for 28 percent of all sales, according to UBS’s 2020 Secondary Market Survey and Outlook.

– Kirk Falconer contributed to this report.