Canada Pension Plan Investment Board became a net seller during the last fiscal year after two years of heavy secondaries investment.
The Toronto-headquartered pension made C$0.7 billion ($0.5 billion; €0.4 billion) of secondaries investments across six deals in the 12 months to 31 March, according to its latest annual report.
This compares with C$5.5 billion during the last fiscal year, which was a 31 percent jump on the C$4.2 billion it invested the year before.
The pension giant cited “two very active deployment years and a cautious market outlook” as the reasons for moderating its investment pace.
CPPIB also executed the full or partial sale of C$2.5 billion of limited partnership stakes across five transactions. The portfolios were centred around older vintages, the report noted.
Investment highlights include LP portfolio transactions worth C$420 million, a C$280 million tender offer on TPG Growth II and a C$180 million structured transaction to provide liquidity to a large US fund of funds manager, the report noted.
CPPIB’s secondaries portfolio was C$7.9 billion in size at the end of March, compared with C$8.6 billion the prior fiscal period. The decrease was driven by C$2.8 billion of distributions, partly offset by C$1.6 billion in net invested capital and C$500 million in foreign exchange gains. Unfunded commitments were C$2.9 billion, unchanged from 31 March 2018.
As of 31 March, 64.8 percent of total exposure was in North America, 24.4 percent in Europe, 6.9 percent in Latin America and 3.9 percent in Asia. CPPIB’s North American exposure was down almost 5 percentage points on the same period of last year and its European exposure up by almost 4 percentage points.
CPPIB’s private equity unit, comprising direct investing, funds and secondaries, increased its asset base to C$94.6 billion from C$87.7 billion at the end of the last fiscal year. Actively managing the unit’s mature private equity portfolio is among its stated priorities over the medium term.
– This report was updated with details of CPPIB’s sale to Ardian and Lexington Partners.