Pomona Capital, the global fund of funds, has bought four LP interests for over $130m including Cinven Fund III & IV and Clayton Dubilier & Rice Fund VII & VIII from New Mexico State Investment Council (NMSIC), according to two sources with knowledge of the deal.
One source close to the process told Secondaries Investor that Cinven Funds III & IV were packaged with with the CD&R funds in order to make the sale more attractive to potential buyers.
Pomona could not be reached for comment at the time of going to press.
A spokesman for the Council refused to comment but confirmed it had executed a secondaries sale of a “handful” of positions in its private equity portfolio, its first transaction since 2006.
According to documents released via request under NMSIC’s Inspection of Public Records Act, as of 30 June 2013, NMSIC allocation to the 2001-vintage Cinven III buyout fund consisted of a $22.7 million commitment, with a remaining exposure of $3.8 million, on which it was experiencing a 2.07x return and an IRR of 30.6 percent.
NMSIC committed $39 million to the 2006-vintage Cinven IV buyout fund, with a remaining exposure of $40.7 million, on which it was experiencing a 1.45 multiple and an IRR of 8.8 percent.
Clayton Dubilier & Rice VII is a 2005-vintage buyout fund which NMSIC had committed $50 million, retaining an exposure of $37.1 million, and was experiencing a return of 1.71x and an IRR of 10.3 percent; Clayton Dubilier & Rice VIII was a 2009 vintage fund which NMSIC had committed $50 million, retained an exposure of $54.6 million, with a 1.49x multiple return and a 20.2 percent IRR.
NMSIC’s combined NAV of the four funds as of last June was $136.2 million.
The sale was won at auction, with Pomona’s Fund VIII the eventual winner at pricing above par, according to two market sources.
Last week Pomona Capital closed its Fund VIII on $1.75 billion, $400 million over its target.
The fund was substantially oversubscribed and hit its hard-cap, with LPs in the fund consisting of pension funds, sovereign wealth funds, financial institutions, endowments, foundations and family offices from over 25 countries, according to a statement release at the time
Fund VIII seeks to purchase interests in high-quality private equity funds, as well as portfolios of private equity companies, the statement said.