Texas County & District re-ups for RRJ Capital’s third fund
Texas County & District Retirement System (TCDRS) will invest $50 million in RRJ Capital’s third fund, which launched earlier this year and is understood to be targeting at least $4 billion.
The pension system committed a similar sum to the GP's second fund in 2013. Other LPs in RRJ Capital Master Fund III include Teachers' Retirement System (TRS) of the State of Illinois, which has agreed to contribute up to $75 million. A filing by the GP last month indicated that $762 million has been raised from 18 LPs, although this does not necessarily reflect the full extent of fundraising efforts.
RRJ was set up by Richard Ong, formerly of Goldman Sachs and Hopu Investment Management, who now runs it with his brother Charles, previously of Temasek Holdings. The firm closed its debut fund at $2.3 billion in 2011 and followed up with a second vehicle worth $3.6 billion in 2013.
RRJ primarily pursues investments in Asia - targeting growth capital, state-owned enterprise and special situations transactions - although the portfolio covers North America and Europe as well, usually where there is a strategic Asian angle. It has recently committed capital to China Everbright Water and is partnering with Philippines-based Jollibee Foods Corporation to launch Dunkin' Donuts in China.
TCDRS had $24.4 billion under management as of September 2014. Of this, $2.11 billion was in private equity - against a target allocation of 12% - $619 million in distressed debt, $419 million in private real estate, $2.28 billion in opportunistic credit, and $6.1 billion in hedge funds.
The private equity portfolio had generated a one-year annualized return of 23.9%, trailing only global equities and master limited partnerships (publicly traded partnership interests that provide real assets exposure). The PE return on both a three-year and a five-year basis was 14.3%.
Recent commitments include $50 million for Baring Private Equity Asia's sixth pan-regional fund, which closed earlier this year at $4.98 billion. TCDRS has also backed the most recent China funds raised by CDH Investments and Legend Capital, as well as The Carlyle Group's fourth Asia vehicle and Baring Asia's debut regional real estate fund.
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