Australasia-Based Private Equity Fund Managers – April 2014

by Cheng Jia Ong

  • 11 Apr 2014
  • PE

As the private equity landscape in Australasia continues to grow and mature, there is considerable scope for more private equity firms to set up roots in the region. The majority of Australasian GPs have their offices established in the financial centers of Sydney and Melbourne in Australia, as well as Auckland and Wellington in New Zealand. Preqin’s Fund Manager Profiles product currently tracks 139 private equity fund managers that are headquartered in the Australasia region. Collectively, these GPs have raised approximately $34bn in aggregate capital over the last 10 years and have an estimated $8.9bn in available dry powder. Out of this corpus, GPs located in Australia have raised over $32bn and are sitting on an estimated $8.3bn in uncalled capital. In comparison, GPs based in New Zealand raised a much smaller amount of $1.5bn in the same time period and hold just over $631mn in uncalled capital.
In terms of fund type, a sizable 54% of Australasia-based fund managers consider the venture capital strategy as part of their overall investment criteria.  At 47%, buyout is the next most common strategy utilized by Australasia-based fund managers and this is followed closely by growth (44%). Other strategies such as distressed vehicles (9%), mezzanine (5%) and direct secondaries (4%) trail behind. Given that Australasia is a mature private equity market which provides room for deal-making opportunities bearing large sizes, it is unsurprising that buyout is one of the preferred strategies adopted by Australasia-based fund managers. Venture capital is viewed favorably by fund managers as well, in light of the Australian government’s effort to boost the venture industry, which entails the roll-out of Early Stage Venture Capital Limited Partnerships (ESVCLPs).

Focusing on the geographical preferences of these 139 Australasia-based fund managers, a significant 74% seek investment opportunities solely in the domestic market. Of the remaining 35 GPs that look outside the borders of Australasia, 26% look to invest in ASEAN, 23% target Greater China, 20% invest in Europe, and 17% have a preference for North America.

The top three Australasia-based private equity fund managers, ranked by aggregate capital raised over the last 10 years, are Pacific Equity Partners, Archer Capital and CHAMP Private Equity. Australian firm Pacific Equity Partners has been the most active fund manager located in the region, having raised close to $5bn, exceeding Archer Capital’s $3.5bn and CHAMP Private Equity’s $2.2bn. Founded in 1998, the private equity firm has a buyout investment strategy and primarily invests in Australasia. Pacific Equity Partners is currently fundraising for its fifth vehicle in a series, which has a target size of AUD 2 billion.

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