University Sells $50M in Holdings

The University has sold $50 million of its venture capital holdings, one of the University most risky and secretive areas of investment, Harvard Management Company (HMC) President Jack R, Meyer said yesterday.

The move is the latest in a series of changes that have occurred in the University's most speculative investments--those in real estate, oil and gas and venture capital. Last October the University devalued these risky investments by a reported $200 million.

The holdings are part of the Aeneas Group, a collection of high-risk, high-yield investments administered by HMC which oversees the University's $5 billion in investments.

Meyer said yesterday the University decided to sell "a series of small positions" in order to free funds for other venture capital investments without expanding its overall commitment to the risky holdings.

"We wanted to focus in [new areas] and reduce our partnership holding," Meyer said. "There were some direct venture deals we wanted to participate in, but we didn't want to get overweighed." Meyer would not specify what the new investments were.

The University's holdings in venture capital were last reported at $750 million.

Through Meyer would not name the 21 venture capital positions that were sold to Landmark Ventures, a venture capital investment company in Hartford, he said that the positions were "not a significant part of the [October] writedown."

"I would suspect that a couple were written down and a couple were written up," Meyer said.

Meyer also would not comment directly as to whether or not Aeneas made or lost money on the sale.

"We were very happy with the sale. We would not have made the sale if we were not," Meyer said.

"Returns are always relative to environment," he added.

Meyer's tight-lippedness is typical of the secrecy with which Harvard Management guards its Aeneas investments. HMC's policy of providing only limited details to the public and the rest of Harvard has continued of frustrate many who believe that the university should disclose these high risk holdings.

"You don't know whether they're selling turkeys or winners," Albert F. Gordon '59, one of the University major donors, said of recent sale.

"These people are not operate in a backroom. They have to operate in fishbowl because they have government, alumni, and student's money," he added. "Harvard Management is like the Kingdom of Oz. You don't know what is real and what is unreal."