Brunel Pension Partnership has selected Neuberger Berman to manage its third cycle private equity portfolio, which will operate under the name NB Clifton Private Equity III, the investment pool announced this morning.

The bespoke private equity vehicle will have £626m (€719m) of capital to commit and will have a 40% impact weighting, which is in line with Brunel and Neuberger’s shared agenda of investing in the new post-transition economy now, it said.

The partnership between Brunel PP and Neuberger dates back to 2019, when the pool made a cornerstone $60m commitment to the Neuberger Berman Private Equity Impact Fund on behalf of four Local Government Pension Scheme (LGPS) clients, as well as an anchor commitment to NB Private Equity’s flagship co-investment fund.

In 2021, it awarded Neuberger Berman a £1.3bn climate transition-linked multi-asset credit mandate and committed £175m to NB Private Debt IV, a senior direct lending fund.

“The expansion of this relationship enables Brunel to implement its third vintage private equity portfolio,” th pool stated.

Neuberger will help Brunel commit most of the capital to third-party primary funds; opportunistic secondaries and co-investments will be made via Neuberger’s commingled funds.

On impact investments, Brunel PP said, they must meet a range of social and climate priorities – Neuberger has strong credentials in ESG integration and impact investing across private equity, the pool added.

The strategy will commit 40% to impact investments contributing to solutions for society and the planet, while the remaining 60% will be invested according to Brunel’s responsible investment policy.

Jaime Alvarez, portfolio manager, private equity at Brunel PP, said: “Private equity has always appealed to our clients as a diversifying asset class with attractive risk-return characteristics. Private equity also offers a particular opportunity to fulfil our clients’ responsible investment ambitions, both through investing with managers that incorporate robust ESG processes, and through increasing our allocation to the rapidly-growing impact investing asset sub-class.”

He noted that with Brunel PP’s well-established relationship with Neuberger Berman, the pool trusts the asset manager’s ”ability to select investments that are not only financially sound but also impactful”.

Ed Jones, head of UK institutional client business at Neuberger Berman, added: “Private equity continues to provide an all-important source of diversification for institutional investors and opportunities for long-term value creation, which will be critical for delivering on LGPS investment objectives.”

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