Endowments and pension funds are becoming increasingly concerned about the concentration of their private equity portfolios because of the large number of club deals, say participants in the industry. As a result, private equity general partners (GPs) are being forced to look for alternative means of financing.
Private equity has become an integral part of institutional investors’ allocation to alternative investments. A recent survey of institutions by State Street Corporation revealed that all respondents had an allocation to private equity. In the same survey last year 10% of respondents reported that they did not invest in private equity. More than half of those surveyed this year allocate more than 5% of their entire portfolio to the asset class.
With the success of the asset class over the past five years, more private...
