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PEFs

NPS, KTCU commit $200 mn to US tech-focused PEF

Nov 02, 2020 (Gmt+09:00)

The National Pension Service and the Korean Teachers’ Credit Union (KTCU) have committed a combined $200 million to technology-focused Thoma Bravo, which closed its 14th flagship fund at $17.8 billion last week, above its target of $16.5 billion.

Each of the two South Korean asset owners committed $100 million to the US private equity firm’s latest blind pool fund, Thoma BravoFund XIV, according to investment banking sources on Nov. 1.

The commitment marked NPS’ first participation in the Chicago-based PEF. The world's No.3 pension fund has already invested in two other leading US technology-focused PEFs — Vista Equity Partners and Silver Lake Partners.

For KTCU, it had co-invested with Thoma Bravo in Ellie Mae, a US cloud-based platform provider, as a limited partner of the latter’s 13th fund. The co-investment produced a 67% internal rate of return (IRR) after Ellie Mae was acquired by Intercontinental Exchange, an operator of global exchanges and clearing houses, for $11 billion in September.

With more than 70% of the 13th fund depleted, most of its LPs participated in the 14th fund, according to the sources.

Thoma Bravo Fund XIV is expected to target large equity investments. Last week, it announced the completion of its $22.8 billion fundraising for three funds, including Thoma Bravo Fund XIV, which is one of the firm’s largest flagship funds in its history.

Including the latest fundraising, Thoma Bravo manages more than $70 billion in assets. Its software portfolio includes over 40 companies that generate approximately $15 billion in annual revenue and employ over 45,000 staff around the world.

Its track record includes the acquisition of more than 260 software companies, including healthcare IT, security, financial technology, infrastructure and applications.

Its ninth fund, which was launched in 2008 and liquidated recently, generated an annualized IRR of 60% and 4.3 times the gross multiple of invested capital, another indicator of the return.

Write to Jung-hwan Hwang at jung@hankyung.com

Yeonhee Kim edited this article.

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