News & Analysis

New Mexico SIC allocates $275m for private equity

New Mexico’s $14bn oil and gas endowment, a long-time investor in private equity, hasn’t made a commitment since early 2009. SIC wants to commit to six funds over the next 12 months.

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The New Mexico State Investment Council, which manages about $14 billion in oil and gas assets, has $275 million to commit to private equity in fiscal 2011.

SIC wants to make commitments to six funds, according to a spokesperson. New England Pension Consultants, the endowment’s interim private equity advisor, is expected to present one or two recommendations at the SIC meeting in November, the spokesperson said.

SIC’s long-term private equity target is 9 to 12 percent, and its actual allocation is slightly under 10 percent, the spokesperson said.

SIC started investing in private equity in 1989, but hasn’t made a commitment since early 2009. The endowment curtailed making commitments to private equity last year after its private equity advisor, Aldus Equity, was indicted in a wide-ranging pension pay-to-play scandal. Aldus’ founder, Saul Meyer, eventually pleaded guilty in the investigation.

Gary Bland, SIC’s former chief investment officer, resigned last October for undisclosed reasons. An article by the Associated Press at the time quoted council member Pat Lyons that Bland’s resignation was under pressure related to the scandal.

Meanwhile, the New York investigation of the pay-to-play situation may ensnare the state’s former comptroller. It was widely reported this week that Alan Hevesi has offered to plead guilty to a felony in the investigation.

Hevesi, who served as state comptroller from 2003 to his resignation in 2006, could make his plea as early as next week, according to an article from Bloomberg.

Henry Morris, Hevesi’s former political consultant, was one of the first people charged in the investigation for allegedly masterminding a scheme to collect sham finder’s fees from private investment firms in exchange for directing pension money their way. The pension system’s former chief investment officer, David Loglisci, pleaded guilty in the probe and is cooperating. At least four others, including Meyer, have also been charged as part of the three-year old investigation.