Nebraska boosts HarbourVest’s secondaries fund

The Nebraska Investment Council approved $50 million in commitments to private equity funds at its meeting last week, according to state investment officer Jeff States.

A total of $40 million was committed to Dover Street VIII, a HarbourVest Partners-managed secondaries fund with a $3 billion target. That fund had raised at least $757 million through parallel vehicles as of November, according to US Securities and Exchange Commission filings.

Dover Street VII, which raised $2.9 billion in 2007, was generating a 1.3x multiple and 20 percent internal rate of return as of 31 March, according to Maryland State Retirement and Pension System documents.

HarbourVest has been an active investor in secondaries since 1986, according to its website. The firm launched its debut secondary vehicle in 1991 and has approximately $9 billion dedicated to the strategy.

In addition to its commitments to HarbourVest, the council also approved a $10 million investment in RCP Fund VIII, the latest in RCP Advisors’ family of funds of funds. Fund VIII has raised $112 million on a $250 million target as of 28 June, according to the SEC. Nebraska had also invested in the latest fund’s predecessor, a $300 million 2009 vintage.

RCP typically invests in lower mid-market buyout funds with $100 million to $1 billion in committed capital, according to its website. The firm invests in approximately 10 to 12 vehicles per fund of fund.

The Nebraska Investment Council is responsible for investing $16.8 billion in state and local retirement system assets, as well as the assets of several endowments, trusts and the state’s deferred compensation plan. The council has a 5 percent target allocation for private equity.

In August, the council approved a plan that would allow the state’s investment staff to re-up with private equity and real estate fund managers without having to wait for approval. Under the new protocol, re-ups would be permitted in instances when optimal or previously agreed upon fund terms are being offered. Commitments would likely be limited to around $25 million, States told Private Equity International at the time.