See GRAPEVINE on Back Page

Millennium Technology Value Partners of New York has hired Joseph Marks to line up secondary-direct investments in companies backed by venture capital funds. The move was unexpected as Marks, a former Coller Capital executive, had just co-founded a two-man second-ary-market brokerage called Castlehaven Advisors in mid-2010. His partner there, Tom Dann, now is in talks to bring in a new staffer and may hire additional personnel. Castlehaven focuses on sales of interests in funds backed by the U.S. Small Business Administration’s Small Business Investment Company program.

James Hoffman has left a post in Pritzker Group’s buyout unit to set up his own firm. Like Pritzker, Hoffman’s startup, called Magna Capital, is based in Chicago. Magna will concentrate on buyouts and recapitalizations of U.S. businesses in a variety of sectors, including industrial

THE GRAPEVINE

JANUARY 26, 2011 Calpers Seeks Bids for Hefty Fund InterestsCalpers is pitching more than $800 million of private equity fund stakes on the

secondary market.The $226 billion pension system began showing the offering to prospective buy-

ers in the last week or so via UBS, working under the codename Project Alpha. A sale is expected to take place quickly, perhaps in a matter of weeks.

Project Alpha is likely to rank among the biggest secondary-market sales of early 2011. For a portfolio of its size, however, it contains a small number of positions — an estimated five or six buyout-fund interests of up to $250 million each.

The pledges are weighted heavily toward large vehicles from well-known manag-ers, with sources pointing to Blackstone Group, Carlyle Group, Kohlberg Kravis Rob-erts and TPG as fitting the profile for shops whose funds might be in the mix. That said, the specific identities of the underlying managers remain unclear.

So what is Calpers’ motivation? Potential pricing appears attractive, with stakesSee UBS on Page 5

Jefferies’ Reshaping Fund-Placement DivisionJefferies & Co. is restructuring its placement-agent unit while starting a sepa-

rate division to raise capital for clients’ distressed-asset and special-situations vehicles.

The new unit would pitch both private equity funds and hedge funds as part of its targeted strategy, with an initial concentration on the U.S. and Western Europe. It would function as part of Jefferies’ high-yield bond desk.

Kelli Roiter is leading the effort. She moved to the high-yield department at year-end from Jefferies’ broader placement group, which has suffered from staff losses as well as accusations that it upset some large clients by employing heavy-handed marketing tactics. Now the word is that the New York investment bank is planning a new look for the operation, although details of that effort remain unclear.

Transfers and defections already have depleted the group’s staff, which recentlySee JEFFERIES on Page 6

TPG Strings Together Small-Investment SeriesTPG wants to replicate a fund that pursues investments deemed too small for its

main buyout vehicles.The Fort Worth, Texas, firm has yet to set an equity target for the new pool, called

TPG Star 2, but is seen as likely to aim for $1.5 billion — the same amount it col-lected for the inaugural fund in the series. It began meeting with investors in recent weeks, telling them it will likely start a formal marketing push during the second half of the year.

TPG Star 2 would pursue investments up to $75 million each while employing venture capital, growth-equity, buyout and turnaround strategies. While it would have the ability to invest globally, the entity would more likely mimic its 2008-vin-tage predecessor by focusing on deals in North America, India and China.

TPG has told backers that the first fund is nearly out of capital. That vehicle tookSee TPG on Page 6

2 LARGEST FUND MANAGERS

3 NASBIC Extends Membership Reach

3 StepStone Ponders Secondary Offering

4 Morgan Stanley Chips Away at Target

4 CIVC Shortfall Made Official

4 China Specialist Shifts to Co-Investing

5 Bank Street Maps Marketing Route

5 Constitution Opts for Dual Pitches

5 LGV Pitch Enters Second Round

6 Matrix Folds Placement Efforts

7 FUND-RAISING ACTION

Private Equity INSIDER

Blackstone, Carlyle In Line for Biggest-Manager Throne

2January 26, 2011

Largest US-Based Managers of Private Equity Funds Excludes firms primarily managing real estate or hedge funds

Assets Under Management 12/31/10 ($Bil.) 1 Goldman Sachs $104.7 2 Blackstone Group 102.3 3 Carlyle Group 97.7 4 Bain Capital 65.0 5 Kohlberg Kravis Roberts 58.8 6 Apollo Management 55.2 7 TPG 48.0 8 Oaktree Capital Management 47.3 9 Credit Suisse 40.8 10 Warburg Pincus 32.0 11 J.P. Morgan Asset Management 29.4 12 Cerberus Capital Management 24.0 13 Fortress Investment Group 23.7 14 Angelo, Gordon & Co. 23.0 15 PineBridge Investments 23.0 16 Hellman & Friedman 22.9 17 Providence Equity Partners 22.0 18 HarbourVest Partners 21.4

Assets Under Management 12/31/10 ($Bil.) 19 First Reserve $20.3 20 Adams Street Partners 20.0 20 Welsh Carson Anderson & Stowe 20.0 22 Ares Management 19.3 23 Lexington Partners 18.0 24 General Atlantic 17.0 24 Riverstone Holdings 17.0 26 Thomas H. Lee Partners 16.2 27 NB Alternatives 16.0 27 TA Associates 16.0 29 Madison Dearborn Partners 14.6 30 J.C. Flowers & Co. 14.4 31 Advent International 14.1 32 Silver Lake Partners 14.0 33 Commonfund Capital 11.8 34 TCW Group 11.5 35 New Enterprise Associates 11.0 36 BlackRock 10.2

Goldman Sachs is still the largest operator of private equity funds in the U.S., but could soon be unseated as new regula-tions force banks to step back from the business.

Goldman’s private equity vehicles had $104.7 billion under management as of Dec. 31, according to Private Equity Insider’s Private Equity Directory. That marks a $10.3 billion decline from a year earlier, when the bank also was the market leader — and it has indicated that it will keep chipping away at the total.

There are even indications that Goldman might spin off its private equity operations altogether. The reason: The Dodd-Frank Act’s so-called Volcker Rule, which once implemented will restrict banks from sponsoring alternative-investment pools while limiting their investments in such vehicles to an amount equal to 3% of Tier 1 capital. Goldman, which repre-sents an important source of backing for its own funds, had $68.5 billion of Tier 1 capital as of June 30. That means it could only hold $2 billion of interests in alternative-investment ve-hicles.

Who could step up to take Goldman’s place? Number-two Blackstone Group is only a hair behind, at $102.3 billion, and has been adding assets. The firm’s total represents a $15.4 bil-lion increase from a year ago, when it was in third place.

Blackstone’s count stands to grow as well, as the shop con-tinues raising capital on top of the roughly $15 billion it already

has collected for its newest buyout fund, Blackstone Capital Partners 6.

The second-place finisher from 2009, Carlyle Group, is now in third. Its $97.7 billion tally marks an increase of $9.8 billion from a year ago, however, and it could breeze into first place by completing a planned takeover of the €40 billion ($55 billion) AlpInvest Partners.

As non-bank players, Blackstone and Carlyle will be insu-lated from the Volcker Rule. At the same time, the institutions are under pressure to add assets — Blackstone to keep holders of its publicly traded shares happy by increasing fee revenues, and Carlyle to bulk up ahead of an initial public offering of its own.

Apollo Management also is among those planning to go pub-lic. It moved up to sixth place from eighth thanks to an increase in assets. TPG, another IPO candidate, slipped one spot to sev-enth despite a slight rise in its total.

Those who might eventually be in the same boat as Gold-man include J.P. Morgan. The bank, whose alternative-invest-ment exposure lies largely in hedge funds, ranks 11th with $29.4 billion in its private equity vehicles. That’s up $4.4 billion from 2009. Most top players saw their totals increase less than $10 billion in 2010.

Private Equity Insider’s Private Equity Directory can beSee THRONE on Page 6

Private Equity INSIDER 3

NASBIC Extends Membership ReachThe National Association of Small Business Investment Com-

panies is broadening its mandate.The trade group, which until now has represented only pri-

vate equity firms backed by the U.S. Small Business Administra-tion’s Small Business Investment Company program, wants to add non-SBIC players to its constituency. As part of the move, it’s planning to work with larger shops than those running most SBIC vehicles.

The organization also plans to change its name to the Small Business Investor Alliance.

NASBIC’s expanded scope takes aim at mid-size private eq-uity firms — namely, those running funds of up to about $600 million. They would include buyout and mezzanine-finance shops, along with operators of funds of funds and secondary-market vehicles.

The move comes in part as a response to feelings among cer-tain mid-size players that they have been neglected by the pri-vate equity industry’s main trade groups, the National Venture Capital Association and the Private Equity Growth Capital Coun-cil. The thought is that the NVCA puts venture capital firms first, while the Private Equity Growth Capital Council is will-ing to protect big buyout shops at the expense of their smaller peers.

The dissatisfaction was reinforced in the organizations’ re-sponses to a Dodd-Frank Act provision that requires most in-vestment firms with more than $150 million to register with the SEC. The NVCA, for example, helped negotiate an exemp-tion for venture capital managers while telling lawmakers that buyout shops often eliminate jobs. The Private Equity Growth Capital Council supported the signups, in part reflecting the fact that most large buyout specialists already are enlisted with the SEC.

For its part, the Private Equity Growth Capital Council has been trying to appeal to smaller firms and counts a few of those shops among its members. However, mid-size buyout man-agers still were left to absorb higher compliance costs under Dodd-Frank.

“There’s a need for middle-market funds to be represented in Washington,” NASBIC president Brett Palmer said.

NASBIC’s increased focus on mid-size shops also ties in with heightened interest among those outfits in taking part in the SBIC program, which offers low-interest government loans to fund managers that back small businesses. For example, Per-seus, Riverside Co. and Veronis Suhler Stevenson set out in the past year to assemble their first SBIC funds.

NASBIC’s recent lobbying efforts have included persuading lawmakers to exempt SBIC funds from the so-called Volcker Rule, a yet-to-be-finalized Dodd-Frank provision that limits bank investments in outside managers’ alternative-investment vehicles. In fact, it appears SBIC pools will be the only type of private equity fund to gain such an exception. NASBIC also helped push for a measure that will allow some investors to pay no capital-gains taxes on profits from sales of small businesses.

Palmer played a key role in both efforts. He joined the group in 2008 from the National Association of Insurance Commission-ers, and earlier held staff positions in the U.S. House and the U.S. Department of Commerce.

StepStone Ponders Secondary OfferingIn a bid to simplify its secondary-market investments, Step-

Stone Group is mulling the creation of a fund targeting those deals.

Details of the effort remain unclear, but expectations are that the La Jolla, Calif., advisory firm will try to raise less than $500 million — the amount of client capital it currently has de-ployed among secondary-market deals via at least a half-dozen separate accounts.

The idea behind establishing a commingled fund would be to reduce the complexity of managing similar activities going forward, at a time when interest in such plays has been grow-ing. Because secondary-market sellers typically like to deal with single buyers, StepStone generally sets up special-purpose vehicles to play that role when more than one of its clients want in on a purchase — then distributes interests in those entities among its separate accounts. But doing that on a deal-by-by deal basis can be an expensive and bureaucratic process.

Still, there are some clients that prefer the tailored nature of separate accounts. For that reason, StepStone is thinking about setting up its fund to invest alongside their portfolios.

StepStone set out once before to assemble a secondary-mar-ket fund, only to drop the effort in favor of the separate-account format when all of the vehicle’s would-be backers wanted to commit $50 million or more. Should the new fund also attract only big-ticket pledges, the firm would likely stick with sepa-rate accounts again.

StepStone generated some expectations that it would try again to start a secondary-market fund with its September pur-chase of Silverbrook Private Equity, a new firm whose personnel included former Hamilton Lane executive Michael McCabe and Pomona Capital alumni Thomas Bradley and Mark Maruszews-ki. They now work at StepStone, which prior to the acquisition had only one partner working solely on secondary deals: James Gamett.

StepStone’s secondary-market clients include Ohio Public Employees, which opened a $200 million account late last year, and Arizona Public Safety Personnel.

January 26, 2011

Free Snapshots of Fund OperatorsIn a rush to find out the basics about a buyout or venture capital firm? Or maybe you’d like to sort through the industry’s 4,000-plus fund operators in a particular category, asset size or region of the world. No problem. Check out the FREE Private Equity Directory in The Marketplace section of PEInsider.com.

Private Equity INSIDER 4

Morgan Stanley Chips Away at TargetMorgan Stanley’s latest fund of funds has begun attracting

institutional backers.The pledges came by way of the fund’s second close, which

took place last week with $287 million. That followed a first close in July with $150 million from friends and families of bank executives. The entity, Morgan Stanley Private Markets Fund 5, has an overall equity target of $1.25 billion.

However, investors said Morgan Stanley would be satisfied with anything more than $800 million, given weak market con-ditions. “The fund-of-funds business has not delivered good value across the board and investors are right to pull back a little,” one manager said.

On the other hand, Morgan Stanley’s 2004-vintage Fund 3 and the 2008-vintage Fund 4 are posting top-quartile returns. Those gains in part reflect an ability to put capital to work more widely than most funds of funds, including capacity for co-in-vestments and secondary-market purchases — both of which tend to produce larger returns than direct fund stakes.

Fund 5 can use up to 25% of its capital for co-investments and 15% for secondary-market deals. That marks a change from Fund 4, which could direct a combined 60% of its equity to such transactions. The reason for the step back: Morgan Stanley is routing secondary purchases to a fund it set up to focus solely on those deals.

That vehicle, Morgan Stanley Global Secondary Opportuni-ties Fund, held its final close in May with $585 million.

Morgan Stanley plans to pocket 5% of Fund 5’s profits, which is typical for a fund of funds but is only half the typi-cal carry for a co-investment or secondary-market pool. The vehicle invests in small or specialized funds, including those following buyout, venture capital, mezzanine and distressed-investment strategies. It is run by a unit within the $19 billion Morgan Stanley Alternative Investment in West Conshohock-en, Pa.

Backers of the previous Private Markets funds include Amica and University of New Hampshire Foundation, along with U.K. pension systems Northumberland County Council and South Yorkshire Pensions.

CIVC Shortfall Made OfficialCIVC Partners’ newest buyout fund has come up short of its

equity target.The Chicago firm quietly held the final close for its CIVC

Partners Fund 4 in the past month or so with $375 million. It had initially talked about collecting as much as $700 million for the vehicle, but later lowered its goal to $575 million.

Market players viewed that figure as more reasonable. It still proved too ambitious though, as weak financial-market condi-tions stymied capital-raising efforts across the private equity industry. Potential backers also were turned off by the results of CIVC’s largest purchase to date: a 2003 investment in bond insurer FGIC alongside Blackstone Group, Cypress Group, PMI

Group and others. That deal proved disastrous as the now-bankrupt FGIC found itself unable to honor its policies — with CIVC realizing less than 10% of its position.

Indeed, there has been talk for a while that CIVC would miss Fund 4’s capital-raising target. In mid-2010, for example, market players said the campaign was about to wrap up with as little as $450 million. That followed a February SEC filing that indicated the shop had collected just $250 million. Among the later commitments was a $25 million pledge from Montana State Board in September.

CIVC invests mainly in business-service, financial-service, and marketing-and-information companies. The shop and placement agent UBS began marketing Fund 4 in mid-2008 alongside a “stapled” secondary-market sale involving $400 mil-lion of stakes that Bank of America held in its previous vehicles. BofA, which had been one of CIVC’s largest backers, pulled back from private equity funds around the same time.

China Specialist Shifts to Co-Investing Fund-of-funds manager Private Equity Analytics has started

a new capital-raising campaign, just a few months after selling a large chunk of its holdings on the secondary market.

The New York shop hasn’t set an official equity target for the vehicle, dubbed ChinaBridge Crossborder Fund, but ap-parently has an eye on collecting $500 million over the next few years.

The plan is for the fund to follow in the footsteps of some prior Private Equity Analytics offerings by investing in main-land China. Instead of adhering to a traditional fund-of-funds strategy, however, it would gradually take on co-investments in batches of up to $100 million each. The entity could have a pledge-fund structure that would allow limited partners to opt in or out of specific deals.

The shift doesn’t come as a total surprise, given Private Eq-uity Analytics’ recent history. The shop, led by Citigroup Ven-ture Capital alumnus Tom Darling, merged with wealth manager MJX Capital in 2009. Darling already counted MJX founder Robert Sillerman among his clients at the time of the arrange-ment, which saw him take on the MJX name.

But MJX wound up selling a large portion of its holdings the next year amid word that Darling would re-emerge under the Private Equity Analytics banner with a slightly different strat-egy. His shop, whose current connection to MJX remains un-clear, now is talking mostly to large limited partners interested in getting a toehold in China’s private equity market.

China’s private investment community has a reputation for shutting out players without local ties — something Private Eq-uity Analytics presents itself as having in the form of relation-ships with managers including China Renaissance Partners, Orchid Asia and WI Harper. The shop has said it would co-invest mainly with firms it has worked with before.

Private Equity Analytics has recently cited a 23.5% rate of return on investments in 11 funds run by six managers, most of which are not set to mature until 2014.

January 26, 2011

Private Equity INSIDER 5

Bank Street Maps Marketing RouteFund-raising plans are taking shape within the growth-

capital division that former Key Venture Partners executive Ted Mocarski is setting up at Bank Street Group.

Mocarski’s unit, Bank Street Capital, is expected to begin marketing its first formal fund in the coming year with an equity target of $150 million to $200 million. Right now, the operation is investing with a smaller pool of capital from its executives and their acquaintances.

The timing of the fund’s launch will likely depend on how quickly Bank Street Capital’s initial backing is put to work. The firm has one deal in its portfolio so far, and probably wants to add one or two more so it can have some results to cite when it approaches new limited partners.

Bank Street Group, an investment-banking firm in Stam-ford, Conn., officially opened Bank Street Capital for business last week. The new shop focuses on investments in media, tele-communications and related technology businesses — some-times drawing on input from two dozen employees of its parent who specialize in those sectors.

However, Bank Street Capital won’t get involved as a backer of Bank Street Group clients.

Bank Street Capital is positioning itself to fill a void that emerged in recent years as venture capital shops that took part in growth-capital deals became less active and buyout firms looked toward larger transactions. At Key, a Boston operation that concentrates on growth-capital plays with backing from Cleveland-based KeyCorp, Mocarski was in charge of venture capital investments.

Mocarski separated from Key about five months ago. Sepa-rately, a team that ran funds of funds and secondary-market vehicles within KeyCorp’s Key Capital division spun off around yearend to form Cuyahoga Capital. That group, headed by Chris-topher Hanrahan and Bart Shirley, now is attempting to raise $125 million for a secondary-market entity called Cuyahoga Capital Partners 4.

Constitution Opts for Dual PitchesConstitution Capital is simultaneously assembling a fund of

funds and a co-investment vehicle.The Boston shop began marketing the entities to investors

in the U.S. and abroad in recent weeks, each with an equity tar-get of $250 million. It already has collected $14 million for the fund of funds, Ironsides Partnership Fund 2, while gathering $6 million for the Ironsides Co-Investment Fund 2.

The tandem offerings mark a change in strategy for Con-stitution, which last time around combined the fund-of-funds and co-investment approaches into a single vehicle called Iron-sides 1. That entity held its final close in June 2008 with $600 million, beating its $500 million equity target.

Like Ironsides 1, the new funds invest in the U.S. while avoid-ing the smallest and largest underlying vehicles — putting their money to work with pools of $300 million to $5 billion.

Constitution formed in October 2007, when a Standard Life Investments team led by Daniel Cahill walked out following a dispute over the economics of a planned spinoff. Its first fund’s backers included the U.K. government’s Universities Superan-nuation Scheme, which bought a 10% stake in the management company. The shop also manages separate accounts, including a mandate it won last month from private equity newcomer Westfield Contributory Retirement.

LGV Pitch Enters Second RoundLGV Capital has held a first close for its latest buyout fund.The London firm completed the initial round of marketing

for its LGV 7 Private Equity Fund at yearend with £171 million ($275 million). It is aiming for £250 million overall.

LGT invests in U.K. companies with enterprise values above £25 million, with a wide scope that includes consumer, leisure, service and healthcare businesses. The strategy has worked well lately, positioning some of the shop’s funds as top performers.

LGV 5, which held its final close in 2005 with £200 million, was posting a 76.9% rate of return as of Dec. 31. That crushed the average gain of 11.4% by European buyout funds from the same year, according to Preqin. Likewise, the 2004-vintage LGV 4 was returning 65.7% heading into this year — compared to a 22.7% average.

It’s too early to judge how LGV 6 is performing. That fund held its final close in 2009 with £98 million.

LGV, a unit of insurer Legal & General, is one of the oldest private equity firms in the U.K. It counts a number of European players among its backers, along with several U.S. institutions. They include Carnegie Mellon University’s endowment, DuPont Capital, MetLife and University of Utah Endowment.

UBS ... From Page 1

in funds like those in the Project Alpha portfolio recently trad-ing near net asset value.

As for likely buyers, Calpers sees an opportunity to exploit demand from a number of large secondary-market fund opera-tors that are sitting on capital they would like to deploy soon, preferably in large chunks. UBS also is giving small and mid-size players a shot by allowing them to take specific fund inter-ests or even portions of those positions — say, $100 million of a $200 million commitment.

A single suitor remains a possibility though, as was evi-denced by a number of sales last year. Two of them involved AXA Private Equity, which bought $1.9 billion of fund stakes from Bank of America and paid €534 million ($730 million) for two private equity units of Natixis. Canada Pension Plan also bought more than $1 billion of fund interests from PSP Invest-ments.

Calpers sold $2 billion of private equity fund interests in 2008 via UBS. That sale, dubbed Project Monarch, saw Conver-sus Capital, HarbourVest Partners, Lexington Partners and Pan-theon Ventures emerge as the winning bidders.

January 26, 2011

Private Equity INSIDER 6

Matrix Folds Placement EffortsMatrix Group is shuttering its placement-agent unit.The London operation is scheduled to wrap up its activities

as soon as March. It already has trimmed its staff this month from five executives to two: partners Edward Holdsworth and Charles Lemon. Gone are principal Charlie Jolly, partner Enzo Narciso and associate James Shipperlee. Jolly now works as a vice president at Pathway Capital. It’s unclear if Narciso and Shipperlee have found new jobs.

Matrix’s withdrawal from the fund-placement business is due to poor capital-raising conditions. The shutdown came as a surprise, however, as is evidenced by the fact that Narciso had only arrived in September. He last led the private equity busi-ness at Union Bancaire Privee of Geneva.

Matrix’s placement division functioned as part of the com-pany’s investment-banking area, which has been expanding. The placement team launched in 2004 with a focus on small funds, and went on to raise more than €1 billion ($1.4 billion) for clients including Langholm Capital, Life Sciences Partners and Litorina Kapital. The group never raised capital for Matrix’s own vehicles, which include private equity funds and hedge funds. Those entities are pitched by other staffers who remain on board.

Jefferies ... From Page 1

numbered about 20. In addition to Roiter’s move, the team is losing group head Stephen Gray to VantagePoint Venture Part-ners. And Luke Belcastro shifted to Jefferies’ equity capital markets area in September. He was among several recruits who arrived in 2009 as part of an expansion of the bank’s placement operation — coming on board with former Mallory Capital col-leagues Peggy Marshall and Donal Orr.

As for the criticisms of Jefferies’ marketing techniques, they center around the bank’s handling of commitments from cli-ents’ prior backers. The talk is that fund managers are only given a short time to round up returning limited partners on their own, with the institution then stepping in to line up those commitments for a fee. And the charges ramp up quickly from there.

“They were telling investors, ‘You have 75 days to get your re-ups, after which we might charge you double our normal rate, then after six months it goes up to 3 times,’ ” an outside fund-marketing specialist said. He attributed Jefferies’ ability to employ such tactics to an overflow of demand for placement services.

Jefferies’ recent clients have included Stockholm buyout firm Valedo Partners, which is set to hold the final close for its second fund in the coming weeks above the vehicle’s equity tar-get of 1.6 billion Swedish krona ($250 million).

Roiter joined Jefferies in 2008 from Citigroup, where she marketed private equity funds to wealthy individuals. Before that, she marketed investments at Credit Suisse and predeces-sor Donaldson, Lufkin & Jenrette.

TPG ... From Page 1

just eight months to assemble, and exceeded its equity target by $500 million. But given today’s tougher marketing environ-ment, investors expect the firm to remain in the market with Fund 2 until yearend, and perhaps into early 2012.

The offering also faces competition for investors with a num-ber of mid-size buyout specialists who last raised capital in 2006 or 2007. It should help that the first TPG Star fund has fared well, with a net rate of return of 8.1% as of Sept. 30. One limited partner deemed that figure impressive in light of the fact that the average age of the entity’s holdings is a mere 1.5 years.

The TPG Star name is an acronym for “smaller transactions with allied resources.” That is, the original vehicle has access to the parent shop’s extensive research and operational resources — something TPG views as a selling point.

The series was created to capture potentially lucrative deals that TPG had to turn away because they didn’t fit the profile of the firm’s big-buyout funds. The most recent of those vehicles, TPG Partners 6, held its final close in early 2009 with $19.8 billion and the capacity to put billions of dollars into each of its deals.

William McGlashan leads a 20-person investment team that runs the TPG Star portfolio. Limited partners include AP Fon-den 2, Calpers, Los Angeles City Employees, New Jersey State Investment, New York Common Fund, Oregon State Treasury and Washington State Board.

Throne ... From Page 2

accessed in “The Marketplace” section of the newsletter’s website, peinsider.com. The ranking encompasses managers of buyout, venture capital, mezzanine-finance and distressed-asset funds in the U.S., along with secondary-market vehicles and funds of funds. It also includes real estate funds and hedge funds run by those firms. However, it leaves out sepa-rate accounts and excludes shops that primarily manage real estate funds and hedge funds.

January 26, 2011

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Private Equity INSIDER 7

FUND-RAISING ACTION

Manager

Fund, Key Executive

Type: Focus

Placement Agent

Target Amount

(Mil.)

Action

Alcuin Capital Partners, London

Alcuin Fund 3, Mark Storey

Buyout: Europe £100 Held first close with £81 million.

Black Diamond Capital Management, Greenwich, Conn.

BDCM Opportunity Fund 2, Stephen Deckoff

Distressed debt

C.P. Eaton $750 Held final close with $982 million.

Brookfield Asset Management, Toronto

Brookfield Special Situations 3, Cyrus Madon

Distressed asset

(None) $1,000 Held second close with $370 million.

Constitution Capital Partners, Andover, Mass. See Page 5

Ironsides Partnership Fund 2, Daniel Cahill and John Guinee

Fund of funds $250 Held first close with $14 million.

Constitution Capital Partners, Andover, Mass. See Page 5

Ironsides Co-Investment Fund 2, Daniel Cahill and John Guinee

Co-investment $250 Held first close with $6 million.

LGV Capital, London See Page 5

LGV 7 Private Equity Fund, Ivan Heywood

Buyout: U.K. £250 Held first close with £171 million.

True North Management Partners, Tempe, Ariz.

True North Venture Partners, Michael Ahern

Venture capital (None) $300 Held first close with $192 million.

To view all past Fund-Raising Action entries, visit The Marketplace section of PEinsider.com

January 26, 2011

F O R U M H O S T

Nancy M. SzigethyFounderNMS Management, Inc.

F O R U M C H A I R M E N

Conley Brooks, Jr.PresidentSawmill Private Management, Inc.

Verónica MaldonadoExecutive DirectorGEM Family Office

Dorothy Collins WeaverChairman & Chief Executive Officer Collins Capital

F O R U M A D V I S O R Y B O A R D

Peter E. “Tony” Guernsey, Jr. Chief Client Officer, EmeritusWilmington Trust Company

Gailen KrugEuropean Private Equity Albourne Partners Limited

K E Y N O T E S P E A K E R

Robert J. ShillerDistinguished Professor ofEconomicsYale University

F E A T U R E D S P E A K E R S

Jonathan AndersonSenior Global Emerging MarketEconomistUBS Investments

Mark A. AngeloFounder & PresidentYorkville Advisors, LLC

Diana Barrett PresidentThe Fledgling Fund

Sheila H. BerubeExecutive Vice President & Chief Investment OfficerWLD Enterprises, Inc.

Vicente Carrillo-BatallaManaging DirectorC.A. Ugave

Jeff CookPresident & CEOPolicy and Taxation Group

Howard R. CooperChief Executive OfficerCooper Family Office

Mark H. DaniellChairman Raffles Family Wealth Trust Pte Ltd

Michael J. FlynnVice President & CIOKinship Trust Company, LLC

Joshua S. FriedmanCo-Chief Chairman & Co-Chief Executive OfficerCanyon Partners, LLC

Christopher B. GalvinChairman, CEO & Co-FounderHarrison Street Capital LLC

Tony GannonChief Executive OfficerAbbey Capital Limited

Nancy S. GillespieManagerSayles Group LLC

David LanskyPresidentThe Family Business ConsultingGroup, Inc.

Stuart LucasChairmanWealth Strategist Partners LLC

Arthur MargonPartnerRosen Consulting Group

William J. Reik IIIManaging Member, CIOBristol Investment Partners

David RosenbergChief Economist & StrategistGluskin Sheff + Associates Inc.

Donna E. ShalalaPresidentUniversity of Miami

Inder SodhiChief Investment OfficerDoshi Capital Partners

Clara VillosladaHevimar

Michael D. WhittyAttorney at LawVedder Price P.C.

Peter ZeihanVice President of AnalysisStratfor

T O R E G I S T E R : Please call 516 933 3700, fax 516 933 3705, or register online at www.nmsmanagement.com

Forum FacultyThe NMS Family Office ForumThe Ritz-CarltonPalm Beach, FloridaMarch 6-9, 2011

Private Equity INSIDER 8

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January 26, 2011

THE GRAPEVINE... From Page 1

products and services, as well as healthcare products. Magna appears to be receiving backing from Pritzker Group, which counts the Hyatt hotel chain among its holdings. Hoffman, who left Pritzker late last month, remains an advisor to the firm.

Tarrus Richardson is setting up a buyout firm whose goal is to acquire contract-ing companies that can benefit from the minority-owned designation he can provide. Richardson, who is black, would own a controlling stake in each portfolio company, which would gain a marketing advantage by becoming eli-gible to compete for work with organi-zations that operate diversity programs. He is about three months away from the official start of his New York firm, IMB Development. IMB would target profit-able companies that already perform contract work for government agencies or corporations. Richardson intends to hold companies for 10-20 years, consid-

erably longer than typical buyout firms. In October, he left ICV Partners, a New York buyout firm he co-founded.

Texas Employees is seeking a private eq-uity specialist to join its investment divi-sion. The recruit would help monitor the $21 billion pension system’s $1.3 billion private equity fund portfolio. Reporting to investment chief Patrick O’Hara, he or she also would manage personnel within the retirement system’s private equity staff. In September, the pension fund laid out plans to invest $550 million in around 10 vehicles during fiscal year 2010, which started Sept. 1. It has an 8% target allocation for private equity funds, which it expects to reach by 2015. Altius Associates advises Texas Employ-ees on its private equity investments.

Private bank Union Bancaire Privee plans to increase its exposure to private equity investments in the coming year. The Geneva operation has less than 1% of its 72 billion Swiss francs ($76 billion) of assets invested with North American and Asian buyout funds. It wants to broaden its portfolio by back-

ing mezzanine-finance and secondary-market funds, and by co-investing alongside its private clients. The bank invests through a private equity division that deploys client money. UBP, which also invests its own capital, runs private equity operations in London, Geneva and New York.

New York buyout shop American Indus-trial Partners has hired former Liberty Partners managing director Ben DeRosa to head marketing and deal origina-tions as a partner. DeRosa started last week. American Industrial is investing through its fourth fund, a 2007-vintage vehicle with $406 million.

American Capital, which invests in mid-size companies, is seeking a junior staffer to help with portfolio monitor-ing and deal execution. Focusing on mezzanine-debt investments, the re-cruit would work on portfolio-company refinancings and exits. He or she would also be expected to perform due-dili-gence reviews of potential investments, working in the New York office of the Bethesda, Md., company.