Yale University’s endowment is exploring sales of private equity fund stakes as Ivy League schools stare down budget challenges stemming from lackluster investment performance and pressure from President Donald Trump.
Evercore is advising the $41 billion endowment on a process that has been in the works for months, according to a Yale spokesperson. The fund remains committed to private equity and is still making new commitments, the spokesperson said.
Yale has not disclosed a target size for a sale. An earlier report by Secondaries Investor said the university may sell up to $6 billion of its private equity portfolio.
Yale’s endowment — which pioneered the move from plain vanilla stocks and bonds to more illiquid assets like private equity — stopped disclosing its asset allocation in recent years. Chief Investment Officer Matt Mendelsohn in October said the endowment has a “significant allocation” to private assets.
Trump’s administration has suspended research funding at Ivy League institutions including Harvard, Princeton and Columbia. He’s also threatened to remove Harvard’s tax-exempt status, which would make fundraising from donors more difficult.
Universities have not been immune to recent pressures in private equity as markets have remained unfavorable for portfolio company exits. Delayed investment returns have pressured liquidity and forced many to rely on the performance of their public stocks and bonds to meet immediate cash needs.
Some are turning to debt. Harvard, among the hardest hit by Trump’s attacks on universities, plans to borrow $750 million to fund spending and Brown University took out a $300 million loan on April 11. Princeton is also considering a $320 million bond sale.
Yale recorded a 5.7% investment return for its 2024 fiscal year ended June and was among the lowest performers of the Ivy League schools.
Written by: Marion Halftermeyer and Janet Lorin @Bloomberg
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