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Largest US pension fund CalPERS in talks with BlackRock to outsource buyout business, source says

  • The California Public Employees' Retirement System is in talks to outsource its private equity business to BlackRock, according to a person familiar with the matter
  • Private equity has been CalPERS' best-performing and main asset class in the past two decades
  • The fund has been criticized for accepting the high fees and limited disclosures associated with the asset class
Signage outside the offices of the California Public Employees' Retirement System (Calpers) in Sacramento, California, U.S., on Sept. 13, 2010.
Ken James | Bloomberg | Getty Images
Signage outside the offices of the California Public Employees' Retirement System (Calpers) in Sacramento, California, U.S., on Sept. 13, 2010.

The California Public Employees' Retirement System (CalPERS) is in talks to outsource its private equity business to BlackRock, according to a person familiar with the matter.

The largest U.S. pension fund's discussions with BlackRock about managing some or all of its private equity investments are at a preliminary stage and may not result in a deal, the person added.

"No decisions have been made. We are still looking at models to bring back to the board," a spokeswoman for CalPERS said.

BlackRock declined to comment.

Private equity has been CalPERS' best-performing asset class in the past two decades and accounts for about $26 billion of its portfolio. But CalPERS mainly invests in private equity funds and has been criticized for accepting the high fees and limited disclosures typically associated with the asset class.

Bloomberg reported CalPERS's discussions with New York-based BlackRock earlier on Thursday.