Deals

Campbell Lutyens, Greenhill, Evercore make LACERA shortlist

A 'very aggressive fee proposal' helped put Campbell Lutyens in the final race for LACERA's $1bn-plus portfolio sale.

By
Rod James
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Campbell Lutyens has been shortlisted alongside Greenhill Cogent and Evercore as a possible advisor on Los Angeles County Employees’ Retirement Association‘s proposed $1 billion-plus portfolio sale, a forward step in its North American expansion.

LACERA issued a request for proposals for a secondaries advisor in January, to which 12 firms responded, according to investment committee meeting documents published by the Californian pension. This list was whittled down to three, as per the table below.

In the documents, LACERA noted that while a number of firms were “certainly highly capable of leading complex transactions” the three finalists possessed the “senior teams, supported by the infrastructure and resources” to ensure the best outcome.

“Firm F lost points because of a well publicised lapse in internal controls that resulted in malfeasance. Campbell Lutyens was awarded points due to their very aggressive fee proposal,” it added.

The meeting documents emphasise that LACERA intends to build a “bench of approved service providers” that can be called upon to help it buy and sell secondaries in future. By building relationships with a number of firms, it can “exert competitive pricing tension in negotiations”and “direct transactions to the optimal service provider for that transaction.”

Citigroup, Credit Suisse, Elm Capital, Houlihan Lokey, Lazard, Melting Point Solutions, Park Hill Group, Setter Capital and Triago also responded to the request for proposal.

LACERA ranked the three finalists according to six criteria, with Greenhill emerging on top.

The finalists will present to the investment board meeting in June, after which a final decision will be made. Any combination of the three could be chosen to run the deal, the documents noted.

LACERA, which has has $55 billion in assets under management, is selling at least 130 “non-core” illiquid positions, Secondaries Investor reported in February. In its initial request for proposals the pension put the portfolio’s value at $1.4 billion. The meeting documents suggest this figure could be closer to $1.1 billion.

Campbell Lutyens has made a concerted push into the US in the past year. In March the firm opened offices in Chicago and Los Angeles as it aims to win business on LP stake sales as well GP-led processes.