Canada Pension Plan Investments is selling a $3.5 billion private equity portfolio to reduce exposure to older funds, according to sources familiar with the matter. The Canadian pension giant, ranked third globally in private equity by PEI's Global Investor 150, is working with Evercore on the sale, dubbed Project Ember. The portfolio includes 56 lines across 26 general partners, with the top 25 stakes valued at $100 million each.

CPP Investments plans to offload between 5 and 75 percent of its ownership in these funds, focusing on buyout stakes ranging from mega to mid-market. Caitlin Gubbels, global head of private equity, explained at PEI Group's NEXUS conference that the pension seeks to trim tail-end exposure as funds age beyond year eight, when alignment with general partners begins to erode. This strategy aims to create room for new investments.

The sale follows CPP Investments' previous secondary transactions, including a $1.1 billion portfolio sale last year and two deals in 2023 totaling over $4 billion. The pension offloaded a $2 billion portfolio to Ardian and an $860 million energy portfolio to Goldman Sachs Asset Management. These moves reflect CPP Investments' active portfolio management strategy amid evolving private equity market conditions.