Private Equity Fundraising

by Michael Granville

  • 04 Oct 2010
  • PE

Preqin Data indicates that the value of funds having reached a final close by the end of Q3 2010 equals an aggregated total of $57 billion, distributed across 81 private equity funds worldwide. Preqin anticipates that this figure will increase slightly as more information become available.

Broken down by region we see that the US-focused funds raised the most capital with $41.1 billion across 37 vehicles. Europe orientated funds raised $8.3 billion across 21 funds while those focused primarily on Asia and the Rest of World raised an aggregated total of $7.8 billion.

Buyout led the way this quarter with 11 funds achieving a final close, having raised a total of $20.4 billion. This data however is skewed somewhat as it includes the Blackstone Capital Partners VI, which closed mid-July on $13.5 billion. Five distressed debt funds raised an aggregate capital of $8.9 billion, while 19 real estate vehicles closed having achieved $8.8 billion in capital commitments. Three Infrastructure and 20 venture funds raised $8.3 billion and $3.7 billion respectively.

Reviewing Preqin data, we see that the average time taken for funds to close in 2010 was 19.8 months, this equates to twice the average of 2004. This increased duration has led many funds to increase the number of interim closes that they have held. Data shows that 44% of funds currently raising have held an interim close, with these funds targeting an aggregate total of $247 billion. 13% have held two or more interim closes, suggesting that they will hold their final closes in the next few months.

Q4 sees a small rise in the number and value of funds being raised as compared to the preceding quarters of 2010. This could suggest a growing confidence among investors as they perceive the environment begin to normalise again. The Preqin Database shows that there are currently 1,550 funds on the road targeting $573 billion.

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