Canada Pension Giant Balks at Fees for Co-Investing With PE (1)

Institutional investors will not allow alternative asset managers to start charging them for large deals despite the emerging competition from retail money, according to Canada Pension Plan Investment Board, one of the world’s largest retirement funds.

Large pensions and sophisticated investors like CPPIB have for decades jointly invested with buyout firms in marquee transactions on a no-fee, no-carry basis. An influx of capital from wealth channels now threatens to change that dynamic.

Any moves by alternative asset managers to levy co-investment fees “will undoubtedly have an impact on our appetite for the asset class, because that’s the model we ...