New Mexico commits $450M to firms focused on growth, energy transition

The New Mexico State Investment Council on Tuesday approved committing $450 million to three firms, all building upon existing relationships.

The investments come at a time when the SIC is overseeing booming state reserves. More than $60 billion sits across around a dozen funds, the largest of which is mainly fueled by the thriving oil and gas industry.

Advent International Corp., founded in Boston 41 years ago, received the largest commitment of $300 million total. The SIC sent up to $150 million to Advent’s GPE XI fund and a broader $150 million co-investment vehicle that doesn’t come with management fees or carried interest.

Advent is one of the oldest private equity firms that exists and has $86.3 billion in assets under management, or AUM, according to the SIC. Of Advent’s 430 private equity investments, 327 have been realized across 40 countries.

The firm has invested in different sectors, including technology, business and financial service, consumer, industrial and health care, according to a presentation to the SIC.

Tricia Glynn, managing partner at Advent, described the firm as a pioneer and said it’s focused on accelerative and transformative investments for businesses.

“We are looking to inflect the line of the businesses we invest in, really apply differential insight resources and look to put that business or brand on a different trajectory going forward for its future,” she said.

The SIC also sent up to $75 million to JMI Equity, a private equity firm headquartered in Baltimore. It’s the state’s fifth commitment to JMI and one of the SIC’s longest private equity partnerships, according to Chris Cassidy, SIC director of private equity.

JMI has $8 billion in AUM and focuses on high-growth software companies. The firm typically invests $25-40 million and generates about 40% growth, according to partner Suken Vakil.

“Our job and focus is to help these companies scale very quickly and grow and capture market share,” he said.

The SIC also approved an up to $75 million co-investment, to go along with a 2024-approved $150 million investment, in energy transition firm Hull Street Energy. Hull Street has $1.9 billion in AUM.

The Maryland-based asset manager reached out to the SIC for the additional investment due to market shifts, especially an uptick in acquisition and merger activity, said Hull Street Founder Sarah Wright.

She said shifts in federal policies, like no longer prioritizing renewable energy, spurred the changes. It opened up assets like hydro, solar and wind sources, where “previously, capital costs were subsidized (and) to some extent that is ceasing. And, in that context, those assets become more interesting to us.”

“This is the kind of environment we love,” Wright added. “The world needs to restructure their portfolios; this is where we like to intermediate.”