Private equity limited partners stumped by fees

There's been a lot of bullishness in the private equity industry as of late. The Dollar General IPO didn't tank right out of the gate. More IPO exits are on tap. And the recovering credit and stock markets have helped the likes of Apollo move ahead with plans to list their stock.

But all is not completely rosy. Bloomberg reports CalPERS, which has been hit hard by the ongoing pay-to-play scandal, has invested $2.23 billion in private equity funds through July. That compares with $5.93 billion during the same period a year ago. Other pensions may follow suit.

While portfolios are looking up, many investors still have not forgiven the recent large losses. CalPERS' distributions from general partners amounted to $437.5 million for the first seven months of 2009, compared with $2.45 billion for the same period a year earlier, notes Bloomberg. There's a lot of pressure to rein in fees. That's for sure. The power relationship may be changing. We'll see how long this lasts.

For more:
- here's the article

Related Articles:
Time to clean up CalPERS?
Investing scandal at CalPERS