Yale University Investment Fund

The Yale Endowment is known in the financial industry as a pioneer in using a combination of innovative asset allocation and active management to produce impressive long-term performance. In fact, the Endowment produced a 17.8% average annual return, net of fees, in the ten-year period ending June 30, 2007.1 This performance is particularly impressive given that, in recent years, the Endowment portfolio has carried less than a 40% weighting in equities. Instead, under the leadership of Chief Investment Officer Dave Swensen, the Yale Investments Office

Furthermore, HMC employed a compensation system that not only helped to attract and retain some of the most adept portfolio managers in the market, but also permitted to align the economic objectives of portfolio managers with those of the university. In other words, the structure and compensation system of HMC was designed specifically to achieve its objectives and to maintain the real long-term value of Harvard’s endowment

La Jolla Cove Investors Management, Inc., a California corporation (the "General Partner") will be the sole general partner of the Fund. The Managers of the General Partner are Travis W. Huff, Brad Barnard, and Steven Romanoff.

1. Evaluate the terms of the proposed $900 million financing from the perspective of both parties. How would you calculate the return to investors in this transaction? If you need more information, what information do you need?

2. What do the results say about how firms in this industry can deliver strong financial returns in different ways?

In 2014, a study from PricewaterhouseCoopers pointed that American investors are looking over-seas’ capital market for investment opportunities, and foreign investors are also looking for investing opportunities in America. According to the research from PricewaterhouseCoopers in 2014, an estimates shows that there are around seven trillion US dollars are invested in foreign stock markets, and American markets are open to non-US firms too. Many of the foreign companies use IFRS rule without any reconciliation to GAAP.

Grove Street Advisors (“GSA”) is a leading fund-of-funds, focused on investing in “low risk” top-tier private equity funds that are not excessively large nor highly levered. GSA is faced with a number of strategic alternatives to help catalyze the firm’s next stage of growth. We propose that GSA expand globally and continue to build expertise in relatively underserved global PE markets such as China and India to help meet its objectives of satisfying customer needs, enhancing its international reputation, staying responsive to trends in private equity, and ultimately maximizing profitability.

B) How well has Berkshire Hathaway performed? In the aggregate? In its investment in Scott & Fetzer? In its investments in earlier purchases of GEICO stock? In its investments in convertible preferred securities?

firms had established international offices from which to deploy money. “Major U.S. LBO operations like “Carlyle, Blackstone, TPG, KKR, and Bain Capital – all had several overseas offices by 2005.” Empire felt the pressure to compete; “by 2005, the question was not whether a large private equity firm had an international operation but what international deals it was doing.

3. What strategies could Adesemi have applied to overcome its operational problems once they occurred? What strategies might the company have applied prior to its investment?

An investment firm with the name of J.D.Williams, Inc. helps many of its clients invest over $120 million for the last 40 years. We have many personal investors helping many individuals with their investments. We create personalized plans for our clients depending on their needs. Our company has multiple methods to help its clients with investments. We use many different approaches when it comes to assessing and making an appropriate plan for the investment.

More recently, the overall weight of private equity in the Investment Office portfolio has been decreasing (from a target of 25% against the most recent number of 17%) as a consequence of Yale perceiving lack of specialization of several equity funds ("positioning themselves as asset managers") and because of the indiscipline and inexperience of several new market players. Albeit, Yale has not dismissed this asset class due to the historical success, the strong relationships developed with key managers, its know-how and experience on the private equity process and not to be perceived as a market-timer type of investor.

1. Assess Interco's financial performance. Why is the company a target of a hostile takeover attempt?

The creation of a formal endowment for Yale was triggered by the 1818 disestablishment of Congregationalism as Connecticut’s state religion. Students and alumni alike demanded that the school respond by establishing a divinity school to offer theological instruction. To fund this effort, numerous alumni made large gifts, the first in a series of successful fund drives. While Yale used many of these donations to buy land and construct buildings, other funds were invested in corporate and railroad bonds, as well as equities. By the century’s end, the endowment had reached $5 million. The growth of the endowment accelerated during the first three decades of the twentieth century, due both to several enormous bequests and to aggressive investments in equities, which represented well over half the endowment’s portfolio during the Roaring Twenties. In 1930, equities were 42% of the Yale endowment; the average university had only 11.5%.3 Yale avoided severe erosion of its endowment during the Great Depression in the 1930s, however, because many recent bequests were kept in cash or Treasuries rather than being invested in equities. In the late 1930s, Treasurer Laurence Tighe decided that the share of equities in Yale’s portfolio should be dramatically reduced. Tighe argued that higher taxes were likely to expropriate any corporate profits that equity holders would otherwise receive even if a recovery did occur. He concluded that bonds would

d. Does the firm appear to have an effective corporate governance structure? Explain any shortcomings.