By Muskan Arora
The $52.4bn New Mexico State Investment
Council committed approximately $250m to its private debt and private equity
sleeves.
The new commitments were made during its June
meeting. The annual investment plan will be presented to the board in August.
Private debt commitment
Tom Lofton, director of debt strategies at
NMSIC, alongside the fund’s consultant, Meketa, recommended that the system commit up to $200m
to AB CarVal Asset-Based Fund.
The evergreen private debt fund is focused on specialty finance opportunities which include privately negotiated credit
investments.
The initial lockup period on the allocation
is three years.
Within its private debt portfolio, special
situations and diversifying strategies occupy the most exposure in the sleeve
alongside highest exposure to North America for investments.
Private equity commitment
Cassidy, director of private equity
strategies at NMSIC, along with the fund’s consultant, Mercer, recommended the board to
commit up to $50m in aggregate to Frazier Life Sciences Public Fund, L.P. and
Frazier Life Sciences Public Overage Fund, L.P.
Frazier Life Sciences Management focuses on early-stage investments in private companies and the other strategy
focuses on publicly listed companies.
The California-based company invests
globally in private and publicly traded companies that collaborate with
biopharmaceuticals.
This is New Mexico’s first commitment to
Frazier Life Services.
The national private equity program
returned 6.4% for the year and had a 3-year return record of 14.6%.
In May, the system made four commitments
including $75m to Bain Life Sciences, $75m to Brightstar, $100m to Kinderhook
and $100m to SK Capital.
Additional portfolio changes
In the same meeting, New Mexico SIC
established two new funds including Capital Development Reserve Fund and
Workforce Development & Apprenticeship Fund, which will be invested by the
state investment officer.
This decision was made along with
consultant RVK.
Further, the system approved the removal of
the designation of the Tobacco Settlement Permanent Fund (TSPF) as a reserve
fund of the state.
The system allocates $372.6m to TSPF, as of
April 31.
“While there are no explicit investment
objectives in the most recent legislative language, it is noted that the
Tobacco Settlement Permanent Fund’s distribution policy is four-point seven
percent (4.7%) of the year-end average market value over the trailing 5
calendar years,” stated RVK, in the meeting materials.
