Chicago Teachers’ Pension Fund Wants Diverse Managers for Middle-Market Strategy

One of the nation’s largest school districts is looking to expand the diversity of managers within its private equity portfolio.

On Dec. 31, the Chicago Teachers’ Pension Fund filed a request for proposal to solicit investment management services from minority-owned, women-owned and persons-with-disabilities-owned private equity firms.

Firms are required to submit their bids on the CTPF’s website by Feb. 1. The pension fund’s board anticipates finalist presentations will occur on March 21 and expects contract negotiations to be complete by June 30.

While managers must be certified as a minority-owned business, a women-owned business or as a business owned by a person with a disability as defined by Illinois legislation, managers can be certified in other states or by other entities. Managers are not required to reside in Illinois.

Managers must also have a record of active private equity investment going back at least three years and a minimum of $300 million in assets under management, but the CTPF said it would consider smaller funds as well.

Among other criteria, the CTPF said it will give preference to firms with growth strategies focused on lower middle-market and middle-market buyouts. The CTPF did not disclose specific amounts but said assets would be offered in a commingled fund structure.

The fund’s private equity portfolio experienced strong growth between 2017 and 2018, increasing 6 percent from $281 million to over $300 million.

Chicago Public Schools is the fourth-largest school district in the United States, with over 361,000 students and 20,000 teachers.