Hundreds of protesters marched last week decrying billionaires and calling for workers’ rights, as part of the AFL-CIO’s national Labor Day protests. But the group also rallied against Chicago-based private equity firm Valor Equity Partners — marching near the company’s West Loop headquarters.
The protest came after the AFL-CIO and the American Federation of Teachers urged companies and leaders of public employee retirement plans that have a relationship with Valor to ask questions about the actions of CEO and Chief Investment Officer Antonio Gracias.
The objection from AFL-CIO, along with many of the protesters, was over Gracias’ work for President Donald Trump’s Department of Government Efficiency. Gracias was tapped by Elon Musk to help DOGE by starting with the Social Security Administration then running its task force on immigration, until July.
The union said Gracias, along with Valor Vice President Jon Koval and Vice President, Data Engineer Payton Rehling, abdicated their fiduciary responsibilities to the private equity firm and its beneficiaries by spending time working for DOGE.
Valor didn’t respond to requests for comment.
On June 24, the AFL-CIO issued a brief focused on Valor and urged leaders of the retirement funds managed by Valor to do more due diligence and ask if Gracias and his team’s time at DOGE resulted in a material investment risk.
“Many of Valor’s more recent funds have not yet made any distributions and have below median performance on their distributions to paid-in capital [DPI ratios], according to Prequel Ltd.,” the brief said.
American Federation of Teachers President Randi Weingarten made a similar ask in a July 21 letter to managers of nine public pension funds, including the California Public Employees’ Retirement System.
Michael Mufson, managing director of Philadelphia-based investment bank Mufson Howe Hunter & Co., said Gracias’ activity is not the norm for the head of a private equity firm.
“It’s highly unusual to have a PE [private equity] executive so overtly involved in politically directed activities,” Mufson said. “Overall, not a lot of good comes from being so involved outside of your focus managing a fund for limited partners.”
Fund managers should ask Valor questions, according to Carin Zelenko, AFL-CIO director of capital strategies.
“Gracias, Koval and Rehling seemed to be moonlighting for DOGE, taking time away from the job which they were hired to do, which was to manage the assets of workers retirements,” Zelenko said. “So, we had a list of questions funds might want to ask. Certainly, about their time away, who was paying for their time and also questions about just what they were doing there.”
Zelenko said as of now, the AFL-CIO is not calling for a boycott of companies that Valor holds majority stakes in.
Valor manages funds on behalf of many public employee retirement plans, including the Illinois Municipal Retirement Fund that administers retirement, disability and death benefits for employees of local governments and the Illinois State Board of Investment, which manages benefits for state employees.
The Illinois Municipal Retirement Fund declined to comment.
An Illinois State Board of Investment spokesperson said in a statement that the group “has not invested with Valor Equity Partners since 2013 and any residual exposure is under .0005 of total ISBI assets under management.” The spokesperson said the board’s current assets under management are approximately $28.6 billion, which means Valor may still oversee $14.3 million.
Illinois Comptroller Susana Mendoza, who serves on four Illinois State Board of Investment committees, said through spokesperson Abdon Pallasch that she was deferring to the board’s statement.
State Sen. Robert Martwick, who serves on two ISBI committees, described the Valor investment as a “one-off deal” that one of the board’s outside consultants made.
“According to the management at the Illinois State Board of Investment, an insignificant amount of pensions have been invested with this person for a long time and those investments, like every other investment, are constantly under review for performance and we will address it in the future as the board sees fit,” Martwick said.
Valor also has investments in several companies, including those based in Chicago such as Wow Bao, Emalex Biosciences, Evozyne and Fooda.
While Gracias has stepped away from DOGE, Zelenko said Valor should still address remaining concerns from the union and the firm’s beneficiaries.
“We believe there are still a lot of unanswered questions about his time away, and we think investors should get answers and take those answers into consideration before making new commitments,” Zelenko said.