The Asia-Pacific region, often clustered into the term Asia-Pac, comprising Asia and Australasia, is typically grouped together in modern-day discussion due to the geographic proximity of the two continents. Preqin’s comprehensive Fund Manager Profiles product reveals that private equity fund managers based in the Asia-Pacific region account for 15% of all global GPs. Collectively, these Asia-Pacific-based fund managers have raised $284bn in the last 10 years and hold an estimate of $110bn in dry powder.
Of these Asia-Pacific-based fund managers, the majority include venture capital, which ranges from early-stage seed to expansion/late-stage investments, within their investment scope. Sixty percent of Asia-Pacific-based fund managers will consider venture capital within their investment preferences as part of their overall investment strategy. GPs based in China account for 25% of the Asia-Pacific-based fund managers that will consider venture capital investments, followed by those headquartered in India (15%), Japan (12%), Singapore (10%) and Australia (10%). Fund managers that will include venture capital within their investment scope have over $43bn in dry powder and have raised more than $123bn in aggregate capital commitments over the past decade. Following closely behind venture capital, the second most common investment preference for this group of GPs is growth stage investments. Forty-eight percent of private equity firms headquartered in Asia-Pacific will consider the growth strategy as part of their overall investment approach. These firms have approximately $63bn available in dry power and have raised over $175bn in capital in the last 10 years. It is worth noting that some managers will operate across multiple investment strategies and stages.
The three largest Asia-Pacific-based private equity firms, based on total funds raised over the last decade, are CDH Investment, Hony Capital and Affinity Equity Partners. The aggregate total of funds raised in the last 10 years by the three largest Asia-Pacific-based private equity firms accounts for 7% of the regional total. All three firms are, incidentally, headquartered in Greater China.
Founded in 2004, Affinity Equity Partners is one of the largest Asia-Pacific-based private equity firms. The firm has raised a total of $6bn in the last decade via its series of buyout funds. Affinity Equity Partners invests with an Asia focus, primarily in the sectors of healthcare, business services, financial services and consumer products and services. The Hong Kong-based private equity firm is currently raising Affinity Asia Pacific Fund IV and held a second close for the vehicle in July 2013 on $2.5bn.