Connecticut Treasurer Denise Nappier announced a $145 million state-focused investment program designed to generate returns for public pension plans.
Nappier said the initiative would stimulate Connecticut's economy through private investment and job creation.
"Connecticut's pension funds are invested in companies all over the world. Yet there are numerous opportunities to generate returns right in our own backyard," Nappier said in a statement on Friday. "The array of investment opportunities in our state is quite rich today, particularly among middle-market companies seeking capital to foster further growth, and now is an opportune time to focus on Connecticut companies."
The new initiative, housed in the private investment fund of the Connecticut Retirement Plans and Trust Funds, earmarks funds for investment specifically in Connecticut companies in various stages of development, from mature to nascent.
"This is, by no means, merely an altruistic policy. It's about making profitable investments that have the ancillary benefit of a positive macroeconomic impact on our state," said Nappier. "Performance will be measured, first and foremost, by risk-adjusted returns, followed by other factors such as job creation and retention and overall economic growth."
To execute the program, Nappier intends to hire three external managers with dedicated expertise in the private debt, private equity and venture capital markets. Investments with these managers hinge upon successful negotiation of the contract terms and partnership documents.
At a meeting of the state Investment Advisory Council on May 13, Nappier presented three funds that will launch the initiative, saying that they are led by "a diverse pool of fund managers with solid track records."
These funds are:
Connecticut Growth Capital, LLC, in which she is considering a commitment of up to $75 million. Balance Point Capital Partners, a Westport-based private investment firm, would manage the fund.
Nutmeg Opportunities Fund II, LLC, with a proposed commitment of up to $50 million for direct in-state investments. JPMorgan Private Equity Group, a New York private equity firm, would manage the fund, which would target private equity investments in Connecticut.
Constitution Fund V LLC, which includes a proposed commitment of up to $20 million for venture capital investments in early-stage, high-potential companies in Connecticut. Fairview Capital Partners, a West Hartford investment firm, would manage the fund.