Three bears tok alaska9/19/2023 Here are the nine investments by Barings in the Alaska Future Fund, as described by the company: The company was founded in 1985 and continues to be locally owned and operated.” ) (The memo to the permanent fund lists eight investments, but this press release lists a ninth as of December 31-Juneau Self-Storage, “a market leading self-storage owner/operator with over 1,400 total units across its three locations throughout Juneau, Alaska. About $2 million has been distributed back to APFC and the net asset value of the investments was $64.2 million last fall. The fund has committed $68 million and transferred $53.6 million. The Alaska Future Fund, set up by Barings, so far has generated a gross internal rate of return of 31 percent. The Legislature needs to start performing the oversight duties it has long neglected. The fear of other companies that the program wouldn’t work with in-state investments alone casts doubt on the wisdom of this approach, which makes public disclosure of investments all the more important. Investment companies that failed to submit proposals to manage a slice of the $200 million told the fund staff that “the opportunity set of suitable private equity opportunities in Alaska that would meet the targeted returns and other requirements of the program was too limited relative to the amount of capital they were being asked to deploy.” Part of the problem is that Barings and McKinley Capital were the only firms that responded to the permanent fund’s request to take on the task of investing in companies with a connection or potential connection to Alaska. The “private appraisal of illiquid assets” means that the investment return numbers should be viewed with skepticism. “Note that neither manager has generated material realizations/exits from their portfolio and valuations of the existing investments are generally based on a private appraisal of illiquid assets (though one of the funds includes a publicly- traded company which is valued at its current share price),” the fund said. The permanent fund says that we are too early in the investment process to draw conclusions about performance of the investments made by Barings and McKinley Capital. We are also learning for the first time about state investments in ventures that include: a self-storage company in Juneau All Alaska Tours in Anchorage Atlantic Aviation, which services aircraft Ekona Power, which is working on converting natural gas to hydrogen Fleetzero, an Alabama company that wants to build electric cargo ships Macro Oceans, a California company that processes seaweed Radiant Industries, a California company working on nuclear power and SafeAI, a California company that wants to retrofit heavy equipment with AI technology for safety. 15 memo from the fund said the Three Bears investment took place a year ago. News of the investment in Three Bears is contained in an update from the two companies that run the two funds set up to invest $200 million in ventures that have some direct or indirect link to Alaska-Barings and McKinley Capital.Ī Feb. The public is not allowed to know how much the “Alaska Future Fund” invested in the grocery chain, an agreement conducted under a program that the Alaska Permanent Fund operates with little to to no public disclosure, relying on language inserted into state law in 1980 that does not provide the blanket secrecy the fund managers claim. The Permanent Fund board is a political creature of the executive branch, with members appointed by the governor and not subject to a confirmation vote by the Legislature. The rules about the investment of public funds in companies with a connection to Alaska need to be changed to limit the appearance or the potential of political corruption. A year ago the news broke that an investment firm called Westward Partners had purchased the Three Bears grocery chain, which has 20 stores in Alaska and Montana and $300 million in annual sales.īut there was no hint that the state of Alaska was a secret investor in the deal through the Alaska Permanent Fund.Īlaskans should have been told last February that the Permanent Fund was involved.
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