Danish labour-market pension fund PenSam has signed a co-operation deal with US pension fund Teachers Insurance and Annuity Association of America (TIAA) and its asset management arm Nuveen to invest DKK1.2bn (€161m) in US private equity.
PenSam plans to invest the sum alongside TIAA in medium-sized private companies in the US and Canada this year and in 2018.
Claus Jørgensen, PenSam’s CIO, said: “At PenSam, we have been looking for an investment partner who has specialist knowledge of the North American market.
“TIAA has the right profile and skills where, with more than $200bn [€169.5bn] in alternative investments and its local knowledge can bring us close to the right, interesting investments in the US and Canada.”
The partnership is part of PenSam’s new strategy for private equity investments within its alternatives portfolio, the fund said.
“When we invest together with TIAA directly in co-investments with other funds, we do it in a more cost-effective way than we have done previously through equity funds,” Jørgensen said.
PenSam said it had been important in making the decision on a cooperation partner that TIAA had the same basis as it did in relation to investment profile and risks.
Jørgensen said that, like PenSam, TIAA existed for its members and that all its profits were returned to customers or invested in developing the business for the benefit of the customers.
“Therefore, we have a shared DNA that is about ensuring a good pension scheme for the customers,” he said.
Jason Strife, head of private equity and junior debt at TIAA, said PenSam was the ideal partner for TIAA’s private equity platform.
“We have one-stop investment interests with a desire to invest in different parts of the capital structure and the opportunities to scale the partnership on a regular basis,” he explained.