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Private Equity Fundraising in South America

by Siobhan Brewster

  • 19 Apr 2010
  • PE

Preqin data demonstrates that there are 60 South American-focused funds currently on the road, attempting to raise an aggregate of USD 29.2 billion in capital commitments.  Infrastructure funds are the most numerous type of fund accounting for 12 out of the 60 funds on the road and targeting a total of USD 4.9 billion. However it is South American-focused real estate funds that are targeting the largest percentage of capital commitments (25%), with 7 funds aiming to raise a noteworthy USD 7.2 billion.

Although there are several larger funds where South America is one of the areas they intend to invest, the largest purely South American-focused fund currently raising is the GP Capital Partners V fund which is targeting an aggregate of USD 1.4 billion. This buyout fund is the fifth such fund being raised by the Brazil-based fund manager, GP Investimentos, and January saw it successfully reach a second close of just over USD 1 billion.

Interestingly a quarter (15) of South American-focused funds currently being raised are intending to invest solely in Brazil and are targeting approximately USD 3.6 billion in capital commitments.  In fact 24 private equity funds currently fundraising intend to invest a proportion of their funds in Brazil. Columbia is also garnering significant interest with 4 Columbia-specific funds raising just over USD 1 billion and another 8 funds intending to devote a proportion of funds raised to investments in Columbia.

Data from Preqin’s Funds in Market product reveals that US-based fund managers are responsible for raising the majority of funds in which there is a South American geographic focus. At the moment 24 of the South American-focused private equity funds currently raising are being managed by US-based fund managers and are targeting an aggregate of USD 11.1 billion in capital commitments. In comparison 21 of the funds currently being raised are managed by South American-based fund managers and together they are targeting a total of USD 5.1 billion. Brazil continues to be the most popular South American country in terms of its ability to attract investment and its preponderance of fund managers, numbering 11 in total.

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