LP briefs, June 2011

Trifecta of Big Changes at Midwestern Pensions

Major personnel changes have been announced at three of the Midwest’s largest pension systems.

At the $26 billion Illinois Municipal Retirement Fund, CIO Walter Koziol is planning for his retirement in the next year after serving in the role for more than two decades.

In neighboring Indiana, the $22 billion, jointly managed Indiana Public Employees’ Retirement Fund (PERF) and Indiana Teachers’ Retirement Fund (TRF), have appointed Bob Clone as the new director of private equity.

And the $76 billion Ohio Public Employees Retirement System named the consultancy Hewitt EnnisKnupp as its sole advisor for alternative investments.

In Illinois, Koziol hasn’t yet set an exit date. The pension fund has already taken the first step of issuing a request for proposal to hire an executive search firm. Linda Horrell, the pension’s chief spokesperson, said a search firm won’t likely be chosen until June or July, so the state pension fund might “be looking well into 2012 before a decision is made.”

In Indiana, Clone has already begun his role managing the private equity investments of PERF and TRF, according to Clone’s LinkedIn page. The appointment was first reported in Fortune. His new boss in Indiana is David Cooper, who was appointed CIO last year. The system manages at least $4 billion in alternative assets.

Clone joins the Indiana pensions after serving with the Michigan Office of Retirement Services for 24 years, including 11 years as its senior manager for private equity investments. There, he managed more than $1.5 billion in private equity commitments, part of that state’s $6.5 billion alternatives portfolio.

In Ohio, the appointment of Hewitt EnnisKnupp comes after the state decided to have one manager for all its alternative investments, instead of separate advisors for private equity, real estate and hedge funds. Previously, Hamilton Lane advised on private equity. —Gregory RothCIO Resigns to Join MassMutual

The Connecticut Retirement Plans and Trust Funds announced that CIO M. Timothy Corbett plans to step down to become CIO and executive vice president of the Massachusetts Mutual Life Insurance Co. In his new role, Corbett will oversee MassMutual’s overall investment strategy and will report to Roger Crandall, chairman and CEO.

Lee Ann Palladino, Corbett’s deputy at the Connecticut pension, will return to the role of interim CIO and will also serve as head of the Connecticut treasury’s Pension Funds Management Division. Palladino was interim CIO prior to Corbett’s CIO appointment in July 2009.

Connecticut’s state pensions have $2.1 billion in private equity and venture capital, or about 9% of the system’s $25 billion in assets. The system’s overall private investment target is 10 percent.

Corbett was responsible for the pension’s investments and strategic planning. His resignation and new post became effective in late May. —Gregory RothNew Name, Ownership for Paul Capital

Paul Capital Investments, a private equity asset management firm created as a joint venture in 2006 between Paul Capital Advisors and the Bank of Ireland, has changed its name to Top Tier Capital Partners to reflect the firm’s “management-led change in ownership.”

The equity stakes held by Paul Capital Advisors and the Bank in Ireland were sold as part of the company’s shift in ownership and brand identity. The firm’s employees now own a majority share of its equity. Additional stakes are owned by the Shea and Hambrecht/Eu families.

Part of the change was driven by the Bank of Ireland’s endeavor to sell all of its “non-core asset management businesses,” following the financial rescue of Ireland’s banking sector.

Top Tier Capital and Paul Capital Advisors plan to retain close ties. Philip Paul, founder and chairman emeritus of Paul Capital Advisors, will serve as managing director and chairman of Top Tier Capital.

Top Tier Capital, which is based in San Francisco and has roots going back to 1991, is known best for its venture capital fund-of-funds. —Gregory Roth