Texas Teachers’ Shoulders Its Way into Blackstone’s Behemoth Private Equity Fund

Sizable commitment shows the pair’s years-long relationship has no signs of fraying.

Blackstone has no problems with securing major commitments from the Teacher Retirement System of Texas, nabbing $600 million in commitments from the Lone Star State’s largest educational pension plan a few weeks ago, according to a recent statement from the system’s spokesperson.

Blackstone Capital Partners (BCP) VIII, the latest in the private equity giant’s flagship large-buyout fund series, is expecting to garner more than $20 billion in commitments. The $600 million commitment is a continuation of Texas Teachers’ long-standing relationship with the fund manager that has been buoyed by robust returns generated for the $153 billion retirement system since 2003.

Source: Teacher Retirement System of Texas

BCP VIII is a stalwart addition to the pension’s $23.31 billion private equity portfolio, which represents approximately 14% of the pension’s entire holdings.
The retirement system also allotted the below commitments during the same  period:

Source: Teacher Retirement System of Texas

Blackstone also attained recent commitments from other domestic institutional investors, including $500 million from the Oregon Investment Council, $250 million from MassPRIM, and $25 million from the Workers’ Compensation Reinsurance Association.

The fund is expected to execute 12-15 investments requiring no more than $1 billion of equity, along a diversified range including exposure to North America (60%), Western Europe (25%), and Asia (15%). The fund managers intend to focus on “large, complex transactions where it can leverage its scale and operating capabilities,” it said in a memo to the Oregon Investment Council.

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