Australian pension fund First Super has picked independent private markets investment and advisory firm Stafford Capital Partners for its A$220 million ($147 million) Australian private equity (PE) co-investment programme.
The development was confirmed by Stafford Capital Partners on its LinkedIn page, adding that the mandate came less than a week after it was awarded an A$250 million global PE co-investment mandate with the $83 billion superannuation fund HESTA.
This is not a first for First Super and Stafford Capital. Stafford’s original private equity programme with the Melbourne-based pension fund, which has been operating since 2010, has generated a net internal rate of return (IRR) of over 20% per annum since it was formed.
The programme will now have an evergreen structure, which means investment proceeds will be recycled and re-invested into new co-investment opportunities, according to reports.
The co-investments will focus on Australian SMEs forecast to generate strong returns. It will also leverage the specialised ESG diligence framework developed by Stafford and First Super.
“The co-investment strategy allows Stafford to access and complete deals on clients’ behalf alongside other leading global private equity managers,” Stafford said.
Stafford Capital Partners, originally founded in Sydney, was born out of a merger between Quay Partners and Stafford Timberland in 2014. It has $7.9 billion in funds under management and advice for more than 150 institutional clients worldwide.
The firm said it has a global team of nearly 100 professionals investing in infrastructure, timberland, and sustainable private equity through secondaries, primaries, and co-investments.
The new mandate will enable the Stafford PE team to build on the co-investment strategy first implemented in 2011 for the superannuation fund.
Stafford Australian PE lead Daniel Bowden said that the strategy sought to open up smaller deal sizes, providing access across a wider spectrum of the private equity investible universe.
