ATP increases its allocation to private equity

Danish pension fund, ATP (Arbejdsmarkedets Tillaegspension), has increased its allocation to private equity from 0.5% to 10% of its DKr 250bn assets under management, with the aim of becoming a leading European private equity investor. The intention is to set up a separate vehicle with an evergreen structure - ATP Private Equity - to invest Euro 3bn into private equity by the end of 2005.

Investments from the fund will initially be made into around 1-3 Nordic funds-of-funds this year. The intention is then to undertake global fund investments, alongside these Nordic investments, making around 8-15 investments yearly, and - although plans have not yet been finalised - around 50% is expected to be invested in Europe, and 50% in the US. Furthermore, around 30% of allocations are likely to be made to technology funds, and the rest into buyout funds. ATP Private Equity would generally wish to be one of the ten largest investors in any fund, and only wishes to invest in a maximum of around 75 partnerships, thus making an average allocation of around Euro 50m into each fund. At the same time, the fund is considering undertaking direct investments in Europe and the US in partnership with private equity houses, while coordinating independent direct investments with a focus on Scandinavia and the Northwest of Europe.

Jens Bisgaard-Frantzen has been employed by the pension fund, specifically to manage its private equity activities, bringing with him a decade of private equity experience, both in direct investments and in fund investments. The four-strong private equity at ATP is expected to increase to 18 by 2004.

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