CPPIB Canadian general partner Q1 2010 performance numbers

I’m sorry that I’m couple of days late, but the 1st quarter CPP Investment Board results are out for the world of private fund managers.

What is interesting about this quarter is that many funds had no change whatsoever to their published December figures. Late reporting? Valuations in irons? Firm essentially shut down?

This post is the latest in the ongoing series covering the Canadian general partners that have been lucky enough to receive a limited partner commitment from the CPP Investment Board (see prior post “CPPIB Canadian general partner Q4 2009 performance numbers” May 29-10).

As highlighted last time, 2009 was quieter for John Breen and his team. For 2009, we saw two new foreign funds in Q1, none in Q2, one in Q3 and four in Q4. As compared to 18 in 2008. For 2010, I can count two new commitments; one of which is a re-up on the 2006 $400 million Buyout/Venture fund dedicated to Canadian GPs.

I know that lots of hay was made out of this additional $400 million commitment to Canada, on top of the initial, and recent (2006-vintage) $400 million commitment to Canadian funds. According to the data, only $198.3 million of that 2006 fund has gone out the door yet; up about $20 million from last quarter (which is a decent jump).

In total, 47 of the last 49 direct GP commitments have been outside of Canada. Coincidentially perhaps, several Canadian funds are going through a wind down right now.

If you are a regular visitor to the site, you’ll know that we pull out the figures showing the performance results that the Canada Pension Plan Investment Board is receiving from its GP relationships (they’ll want me to remind you that’s calendar Q1, not CPPIB’s fiscal Q1).

As we’ve done in the past, I’ve added our own Wellington Financial Fund II returns (as at Q1/10) as they get muddled when included as part of the CPPIB Legacy VC fund of fund program that committed $10 million in December 2004 (back when Edgestone ran the program for CPPIB) to our $83MM Fund II. I’ve also stripped out the returns that we provided to that fund to see how it did without our profits baked in (the Fund of Fund’s loss increases from -38% to -44%). Fund II ceased pursuing new transactions in August 2006 with the first closing of our $150MM Fund III that month (because our targeted financial returns aren’t the 30% “venture capital-like”, we didn’t fit the GP profile sought by NorthLeaf’s VC fund-of-fund program).

One can take some pride that our Fund II improved the CPPIB’s Canadian VC Fund of Fund’s entire return by 6%, even if we aren’t shooting for 30% gross IRRs. Better to make money than not, I always say.

As with last quarter, I thought it would be only fair to put out our Fund III numbers. To remind, our funds are recirculating in nature (read: LP friendly), so we keep the overall fund size smaller and between a capital call line and deal exits, we’ve been able to lead $187.2 million worth of transactions via 34 deals in our $150 million Fund III, but only have half of our capital drawn as of Q1.

The figures that follow cover four categories: CPPIB’s commitment, paid-in-capital (which tells you how much of the fund is invested in deals and/or drawn to pay management fees), reported value, and reported value + distributions (which tells you what the notional simple return of the fund is against the paid-in-capital figure). That figure is based in large part on what the manager believes the portfolio is worth as at Mar. 31, 2010, subject to GAAP fair value accounting. MM means millions. “Home” currency.

Canadian Venture and Life Science Funds

Celtic House VP Fund II (2002 US$):
$13.5MM, $15.1MM (112%), $11.6MM, $23.8MM (+58%)

Celtic House VP Fund III (2005 US$):
$50MM, $32.7MM (65%), $22.3MM, $23.2MM (-29%)

Edgestone Venture Fund (2001):
$50MM, $45.1MM (90%), $16.2MM, $63.6MM (+41%)

Edgestone Venture Fund II (2004):
$50MM, $45.8MM (92%), $29.2MM, $30.5MM (-33%)

Lumira/MDS Life Sciences Technology Fund II (2002):
$200MM, $115.1MM (58%), $52.3MM, $113.1MM (-1%)

Skypoint Telecom Fund II (2001 US$):
$25MM, $23.3MM (93%), $7MM, $10.8MM (-54%)

Northleaf/TD Capital Legacy VC Fund (2002):
$82MM (originally $100MM), $67.8MM (83%), $30.7MM, $42MM (-38%)

Northleaf/TD Capital Legacy VC Fund (2002)
ex-Wellington’s Fund II investment:
$72MM, $61.0MM (85%), $30.65MM, $33.97MM (-44%)

Ventures West 8 (2004):
$50MM, $42.1MM (84%), $29.1MM, $31.2MM (-26%)

Wellington Financial Fund II (12/04):
(CPPIB participated in our $83MM Fund II via a $10MM commitment when Edgestone managed the what’s now called the “Legacy VC Fund”)
$83MM fund size, $56.3MM (68%), $0.35MM, $66.6MM (+18%)

Wellington Financial Fund III (2006):
$150MM fund size, $75.5MM (50%), $76.5MM, $91.3MM (+22%)

Canadian Buyout and Other Funds

Birch Hill Equity Partners III (2005):
$85MM, $84.9MM (100%), $84.6MM, $101.3MM (+19%)

Birch Hill Equity Partners IV (2009):
$50MM, $0MM (0%), $0MM, $0MM (0%)

Brookfield Special Situation I (2001):
$150MM, $187.1MM (125%), $19.7MM, $302.3MM (+62%)

Brookfield Special Situation II (2007):
$300MM, $332.3MM (111%), $237.3MM, $361.7MM (+9%)

Clairvest Equity Partners I (2001):
$50MM, $46.8MM (94%), $20.9MM, $79.6MM (+70%)

Clairvest Equity Partners III (2006):
$40MM, $31.4MM (79%), $29.2MM, $28.7MM (-9%)

Edgestone Equity Fund II (2002):
$100MM, $87.7MM (88%), $41MM, $115.5MM (+32%)

Edgestone Equity Fund III (2006):
$100MM, $65.1MM (65%), $31.5MM, $48.6MM (-25%)

Edgestone Mezzanine Fund II (2000):
$30MM, $29.3MM (98%), $0MM, $27.7MM (-5%)

Kensington Co-investment Fund (2002):
$40MM, $42.4MM (106%), $9.9MM, $54.6MM (+29%)

Onex Partners (2003 US$):
$150MM, $140.5MM (94%), $146MM, $354MM (+152%)

Onex Partners III (2008 US$):
$400MM, $29.5MM (7%), $23.8MM, $23.8MM (-19%)

TD / CPPIB CDN Private Equity Holdings I (2006):
$400MM, $198.3MM, (50%), $155.8MM, $172MM (-13%)

TD Capital CFOF Legacy Buyout (2002):
$121MM, $114MM (94%), $70.6MM, $127.2MM (+12%)

MRM