The $65 billion Alaska Permanent Fund Corporation (APFC) has teamed with the $100 billion-plus Public Institution for Social Security of Kuwait (PIFSS), £28 billion ($38 billion) RPMI Railpen, and the $20 billion Wafra to create a new entity known as Capital Constellation.
According to a news release, Constellation will provide capital to “next generation” private equity and alternatives managers, with Wafra advising the entity. Approximately $700 million will be initially committed to Constellation by the founders. Railpen and the APFC will each commit $200 million, while the PIFSS will commit the remaining $300 million. The entity is expected to deploy more than $1.5 billion through 2023.
“We are thrilled to bring together three of the world’s premier institutional investors to establish Constellation,” Russell Valdez, senior managing director of Wafra and a founding board member of Constellation, said in a statement. “We believe this innovative investment platform will be a key resource for investment managers as they launch and build the next generation of successful and enduring private equity, real estate, and other alternative investment franchises.”
The goal of the founders for their new consortium is to aid alternative investment managers to obtain initial fundraising by providing long-term capital base and operational support so Constellation may generate beneficial results for its members’ pensioners and citizens.
“Combining forces with leading institutional investors through Wafra will enable us to find future stars in the investment space. Looking for long-term partnerships should be a key to our success,” stated Meshal Al-Othman, chief investment officer of PIFSS.
“We believe Constellation provides us unmatched access to the next generation of successful alternatives managers, and will be a source of long-term returns that will help us achieve our mission to pay members’ pensions securely, affordably, and sustainably,” Paul Bishop, Railpen investment director and a founding board member of Constellation, said in a statement. “We think the historical outperformance of first-time funds is meaningful, as is the participation Constellation receives in GP economics.”
Subsequently, Constellation announced its first strategic partnership with private equity manager Astra Capital Management LLC, to which it has committed $100 million.
“We are delighted that our first strategic relationship will be with Astra, a firm with the talent to ascend to great heights,” Daniel Adamson, managing director of Wafra and president of Constellation, said in a statement. “We have already begun supporting Astra as a strategic partner across three continents, working closely with Mark, Bill, Kevin, Todd, Matt and the rest of their investment partners to help them realize their long-term goals.”