The California Public Employees' Retirement System is planning to launch two private equity strategies that will invest an aggregate of $20 billion and is in discussions with Silver Lake Partners veterans David Roux and Adam Grosser to potentially manage those initiatives, Bloomberg News reported, citing a phone interview with two of the pension fund's executives.
John Cole, who is spearheading the initiative for CalPERS, said in the interview that the pension fund is in talks with Roux and Grosser to lead its respective Horizon and Innovation strategies. The Horizon strategy would invest $10 billion in up to 10 companies, potentially in the consumer or industrial sectors, while the Innovation strategy would inject about $10 billion into late-stage venture capital companies focused on biotechnology, healthcare and technology.
Roux co-founded Silver Lake, and Grosser headed the private equity firm's Kraftwerk fund. The pair is among several candidates CalPERS is considering to run the direct-investing strategies, Cole noted in the interview.
As part of the CalPERS initiative, two limited liability companies overseen by external managers will be set up, with the terms and conditions of the entities expected to be up for board approval in February or March, Cole said.
The proposed strategies are aimed at increasing the pension fund's private equity holdings to 10% of its assets, from about 8%, CalPERS Chief Investment Officer Ben Meng added.
Grosser and Roux did not immediately respond to requests for comment, while a spokeswoman for Silver Lake declined to comment on the matter, according to Bloomberg.