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PEIA to speak for European LPs

The UK-based association representing more than 20 investor institutions, including the Wellcome Trust, Hermes and the USS, is seeking to raise its profile and better represent LPs during the downturn.

The Private Equity Investors Association (PEIA) has said it is “open for business in 2009” and aims to raise the profile of limited partners.

The organisation, which provides a forum for limited partner investors, has been going for many years but has kept a low profile. It now seeks to raise its profile to create a voice for LPs, PEIA chair Robert Coke said in an interview.

Fellow board member Susan Flynn, a director of Hermes, said: “I think LPs have been under represented when there have been major events affecting the industry.” During the UK House of Commons Treasury Select Committee inquiries into the significance of private equity in the UK in 2007, for example, none of the witnesses called to speak were specifically representative of LPs – the majority were well known GPs.

PEIA grew out of an informal relationship between a small group of major European LPs who would talk to each other in the industry in the 1990s, a source said. Robert Baird, the now retired former investment manager at Wellcome Trust, suggested the formalisation of the association. “It became a formal organisation” in 2002, “but we did not seek to publicise it and relied on word of mouth”, Flynn said. The result has been that “people didn’t seem to know [PEIA] existed”.

PEIA now has more than twenty institutional LPs as members across Europe including Hermes, Wellcome Trust, Universities Superannuation Scheme and Coal Pension Schemes.

The association, which meets quarterly, has created an environment within which LPs can speak freely. It does not publish research and instead the objective is to discuss the views and issues facing LPs, to invite experts in the industry and to speak to them and to create a networking environment. It seeks to create a focal point for LPs to promote best practise, high standards of business conduct and professional competence, it said.

All LPs who are not also GPs are welcome. The association does not represent fund of funds or mezzanine investors.

The association plans to raise its awareness via a series of events next year, it told PEO. One of the events under discussion is a kind of “speed dating for GPs”, where LPs can speak to several fund managers all at one time, Coke said.

Flynn also noted that a number of similar organisations have sprung up recently. The Institutional Limited Partners Association is PEIA’s well known counterpart in the US, and is another not for profit organisation representing the interests of LPs, promoting codes of practise and acting as a representative body.