Private Equity’s Biggest Backers Are Tired of the Fees
ByLove the returns. Hate the fees. Is it time to go solo?
The biggest U.S. pension fund isn’t happy. After years of paying steep fees to private equity fund managers, it’s plotting an end run. Officials of the California Public Employees’ Retirement System, which oversees about $337 billion, gave fund managers an earful at a pension board meeting on July 17 in Monterey. Huffed one CalPERS director: “I don’t see your industry standing up and justifying fees.” (The pension’s chief investment officer later said it would explore buying more companies on its own to lower fees and lift returns.) Firing back, Sandra Horbach, a top executive at Carlyle Group LP, one of the world’s biggest leveraged buyout managers, warned that CalPERS and other pensions looking for their own deals would be at a “strategic disadvantage” in a head-to-head rivalry with private equity firms like Carlyle…
Private Equity’s Biggest Backers Are Tired of the Fees
