The Wall Street Journal-20080125-New Jersey Fund Seeks More Deals
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New Jersey Fund Seeks More Deals
New Jersey's pension fund, fresh off big investments in Citigroup Inc. and Merrill Lynch & Co. last week, is in talks with a foreign- government fund and other large investors about teaming up in new deals to strike better bargains, according to a top New Jersey fund official.
William G. Clark, director of the New Jersey Division of Investment, which manages the state's $81 billion pension fund, said that these discussions are still in early stages but have been going on for about six months.
He said the New Jersey fund has spoken with at least one "sovereign wealth" fund -- a government fund set up to manage a portion of state money -- as well as with U.S. state pension funds and private-equity funds.
"We think there are advantages for large institutional investors banding together to drive more favorable terms," Mr. Clark says. "You saw what those advantages are in the Merrill and Citi deals." Those preferred-share offerings paid a higher return than common stock because Merrill and Citi were willing to offer better terms in exchange for a quick infusion of cash.
Mr. Clark said that New Jersey and the other funds also discussed investments in private-equity firms, similar to the California Public Employees' Retirement System recent purchase of a 10% stake in the buyout firm Silver Lake.
The talks were revealed by Orin Kramer, chairman of the New Jersey State Investment Council, speaking at a hedge-fund conference in Florida.
