Ontario Teachers’ Records First Private Equity Loss in Over a Decade
Ontario Teachers’ Pension Plan, a CAD200bn pension fund manager, posted its first loss in private equity since 2009, with the portfolio’s value dropping by about CAD10 billion in 2025, according to a report by Bloomberg as cited in Private Equity Wire. In response, the fund announced it will narrow its private equity investment focus to three core areas: financial services, technology, and services. This marks a significant shift for the organization, which combines direct investments with allocations to external fund managers accounting for around 28% of its private equity portfolio.
Drivers of the Loss and Strategic Adjustments
The private equity losses were partly due to valuation adjustments in sectors such as software and healthcare, driven by uncertainty around artificial intelligence and heightened deal activity following the post-pandemic investment boom. At the end of 2025, the pension plan’s private equity portfolio was valued at approximately CAD50.8bn, while its overall net assets rose to CAD279.4bn. Portfolio companies include Abano Healthcare, Nvision Eye Centers, and PhyMed Healthcare Group, and the fund acquired a majority stake in IT services firm Miratech in 2021, reflecting its ongoing activity in the asset class.
Overall Fund Performance Amid Setbacks
Despite the private equity downturn, the fund achieved a 6.7% return for the year, bolstered by gains in public equities, gold, and specific holdings such as SpaceX. The venture growth portfolio performed strongly with returns of around +30%, attributed to investments in companies like SpaceX and Databricks. As a widely recognized major pension fund, Ontario Teachers’ adjustments highlight broader market dynamics in private equity, though such funds often balance risks across asset classes to maintain stability.
Implications for Investment Approach
The organization continues to integrate direct investments with external manager allocations, as evidenced by the 28% portfolio share dedicated to the latter. This approach persists even as the fund refines its focus, with executives noting the influence of sector-specific challenges like those in software and healthcare. According to Private Equity Wire, these changes underscore the fund’s adaptability in a volatile environment.
