Home > News > Corporate Moves > Value of Pension-Backed M&A Deals Soars to $13.6B in Q2
Corporate Moves

Value of Pension-Backed M&A Deals Soars to $13.6B in Q2

Despite seven fewer transactions than one year earlier, total deal value rose 158%.

By Michael Katz



Mergers and acquisitions with direct pension fund involvement soared in the second quarter to $13.58 billion from $1.34 billion the previous quarter and $5.28 billion in Q2 2023, according to S&P Global Market Intelligence data.

It was the largest value for pension-backed M&A deals in a quarter since Q1 2023. But despite the surge in deal value, the number of transactions fell to 21 in the second quarter from 32 the previous quarter and 28 during the same period one year earlier.

During the first half of 2024, there were 53 deals worth a total of $14.92 billion, compared with 59 deals worth a total of $20.55 billion during the first half of 2023.

The largest M&A deal that had direct pension fund participation in this year’s second quarter involved the Canada Pension Plan Investment Board and private equity company Global Infrastructure Management LLC, which agreed to buy energy company Allete Inc. for $6.23 billion, including debt.

Never miss a story — sign up for CIO newsletters to stay up-to-date on the latest institutional investment industry news.

The second-biggest deal involved an investor group that included the Employees Provident Fund of Malaysia, which agreed to acquire the remaining stake it did not already own in Malaysia Airports Holdings for $3.18 billion. The third-largest deal involved a group that included the Labourer’s Pension Fund of Central and Eastern Canada, which acquired eStruxture Data Centers for $1.09 billion.

According to S&P, Canadian pension funds were involved in five of the 10 biggest deals during the second quarter, while private equity and venture capital firms were co-investors in three of the biggest deals.

Pension funds directed the most capital to the energy and utilities sector during the quarter at $7.72 billion in total, S&P reported, 19 times the $405.6 million pensions invested in the sectors during the same quarter last year. The industrial sector was targeted the second most with $4.26 billion, while pension fund-backed deals in the technology, media and telecom sector plummeted to $1.13 billion from $17.23 billion during the second quarter of 2023.

Related Stories:

Global Pension Fund M&A Investment Drops Off Cliff in Q2

Pension Fund-Backed M&A Deals Continue to Nosedive

Slowdown in PE Exits, M&A Activity Leads to Smaller, Slower Distributions to Public Pension Funds

Tags: , , , , , , , , , ,

Home > News > Pensions > Pensions in Michigan, Jersey City Add Bitcoin ETFs to Portfolios
Pensions

Pensions in Michigan, Jersey City Add Bitcoin ETFs to Portfolios

Only three public pension funds are known to have acquired these types of ETFs.
By Matt Toledo



The Employees’ Retirement System of Jersey City plans to allocate a small percentage of its portfolio to a Bitcoin ETF, Jersey City Mayor Steven Fulop said Thursday in a post on the social media platform X.  

“The question on whether Crypto/bitcoin is here to stay is largely over,” Fulop wrote. “The Jersey City pension fund is in [the] process of updating paperwork to the SEC to allocate [a percentage] of the fund to Bitcoin ETFs.”  

Fulop said on X that the move would be similar to the allocation the State of Wisconsin Investment Board made to a Bitcoin ETF. SWIB, the first U.S. pension fund to announce plans to add a Bitcoin ETF to its portfolio, made a $160 million allocation to two ETFs in May.  

Fulop said the process would be completed at the end of the summer, noting that he believes that crypto exposure in pension fund portfolios will become more common. In May, two Bitcoin ETF providers told CIO that some U.S. public pension funds are among those interested in in learning about their ETFs.  

Never miss a story — sign up for CIO newsletters to stay up-to-date on the latest institutional investment industry news.

The Jersey City pension fund’s allocation to the digital assets will be revealed in more detail when the fund files its Form 13F, which will be available 45 days after the end of the quarter.  

The Jersey City pension fund is not alone. In a Form 13F filing made this week with the Securities and Exchange Commission, the State of Michigan Retirement System was revealed to have allocated $6.6 million to Ark21 Shares Bitcoin ETF, owning 110,000 shares of the ETF, as of the second quarter. 

The State of Michigan Retirement System has approximately $100.9 billion in assets under management; its allocation to the ETF is about 0.0065% of the fund’s total assets. 

The Michigan pension system allocates 21.8% of its assets to private equity and venture capital, 21.4% to domestic equities, 13.8% to international equities, 10.4% to real return and opportunistic opportunities, 9.9% to absolute return assets, 9.3% real estate and infrastructure, 8.7% to fixed income and 4.7% to cash equivalents.  

The assets are invested across multiple pension funds, including the Michigan Public School Employees’ Retirement System, the State Employees’ Retirement System, the Judges Retirement System, and the State Police Retirement System. 

In early January, several Bitcoin ETFs were approved by the SEC. These ETFs have been scooped up by wealth managers, retail investors, asset management firms and hedge funds, but had been relatively untouched by pension funds and other allocators. SWIB, the Michigan Retirement System and ERSJC are, so far, the only three funds known to have such allocations. 

Updated with correct SWIB and MRS allocations to the ETFs.

Related Stories: 

Where Does a Bitcoin ETF Fit in an Allocator’s Portfolio? 

Wisconsin Pension Buys $160 Million in Bitcoin ETFs 

New Jersey Pension Fund Gambles on Bitcoin Miners 

Tags: , , , , , , , , , ,

«