Wafra’s $700 Million joint venture with The Alaska Permanent Fund Corporation


Kirkland & Ellis LLP advised Wafra on the deal

The Alaska Permanent Fund Corporation, the Public Institution for Social Security of Kuwait, RPMI Railpen and Wafra, a leading manager of private equity and alternative investments, have established a new entity called Capital Constellation.

Constellation will provide catalytic investment capital to next generation private equity and alternatives managers and will be advised by Wafra. Combined, the founders will initially commit $700 million to the venture and Constellation is expected to deploy over $1.5 billion in the next five years.

Constellation will bring together the expertise and capital base of three of the world’s premier institutional investors, spanning Europe, North America, and the Middle East. Constellation leverages Wafra’s existing capabilities to form partnerships with promising investment teams who demonstrate the investment and operational expertise required to generate strong investment performance and business growth.

Constellation’s mission is to assist talented alternative investment managers in breaking through the challenges of initial fundraising, specifically by providing strategic and operational support and an aligned, substantial and long-term capital base. In return, Constellation’s unique structure is designed to generate consistent, long-term value for its members’ pensioners and citizens.

In conjunction with the formation of the joint venture, Constellation today announced its first strategic partnership with Astra Capital Management LLC (“Astra”), a private equity manager specializing in growth buyouts in the communications and technology services industries. Astra’s founders have over 100 years of industry, investment and operating experience in the communications and technology industries, and have previously worked at leading institutions with long histories of successful investing in the sector. Constellation has committed $100 million to Astra and will work closely with their leadership to support Astra’s mission and growth.

Wafra has more than $20 billion of assets and commitments under management and invests across a wide range of alternative asset classes. In its pursuit of investment excellence, Wafra connects its investors, partners and stakeholders to foster an exchange of ideas and innovations. Behind Wafra’s investment strategies are professionals headquartered in New York and other financial centers who bring the long-term vision of Wafra’s stakeholders to alternative investments.

The Alaska Permanent Fund Corporation was created by the Alaska Legislature in 1980 as a quasi-independent state entity tasked with the important mission of prudently investing and managing the assets of the Alaska Permanent Fund. As one of the first sovereign wealth funds, and the largest fund of its kind in the United States, the Alaska Permanent Fund has gained world-wide recognition as a model for converting a non-renewable natural resource into a renewable financial resource, safeguarding approximately $64 billion for all current and future generations of Alaskans.

The Railways Pension Scheme is one of the UK’s largest and longest established pension funds. RPMI Railpen is responsible for the safekeeping and investment of around £28 billion on behalf of the scheme’s 350,000 members who are connected with the railway industry. Railpen’s mission is to pay members’ pensions securely, affordably and sustainably by investing the scheme’s assets to generate strong investment returns over the long term.

The Public Institution for Social Security of Kuwait runs the social security system for all Kuwaiti nationals spanning public and private sector professionals working at home and abroad. More than just retirement benefits, the system protects members in cases of sickness, workplace injuries and disabilities. As an investor, PIFSS looks for opportunities across global markets in asset classes including fixed income, equities, real estate, private equity, hedge funds, infrastructure and other alternatives. The Social Security system in Kuwait has a long history dating back to the 1950s and is one of the bedrocks of the nation’s social services. PIFSS itself was established in 1976 to take the lead in its implementation.

The Kirkland team was led by corporate partner Paul Watt (Picture) and associate Suzannah Hacking with support from tax partners Stephen Butler and Donald Rocap; corporate partners Jai Agrawal, Joshua Soszynski and associate Anna Baxendale; executive compensation partner Scott Price; and investment funds partners Elizabeth Richards and Aaron Schlaphoff.

Involved fees earner: Paul Watt – Kirkland & Ellis; Jai Agrawal – Kirkland & Ellis; Elizabeth Richards – Kirkland & Ellis; Suzannah Hacking – Kirkland & Ellis; Aaron Schlaphoff – Kirkland & Ellis; Anna Baxendale – Kirkland & Ellis; Donald Rocap – Kirkland & Ellis; Stephen Butler – Kirkland & Ellis; Scott Price – Kirkland & Ellis; Joshua Soszynski – Kirkland & Ellis;

Law Firms: Kirkland & Ellis;

Clients: Wafra Investment Advisory Group, Inc.;