Private Equity Funds in Market: What LPs Need to Know

by Bogusia Glowacz

  • 26 Jun 2012
  • PE

Private equity fundraising remains very competitive with as many as 1,263 private equity funds currently on the road seeking a combined $544bn (excluding real estate and infrastructure funds). This is an increase from 1,086 vehicles targeting $433bn as of June 2011 and 1,043 funds seeking aggregate of $358bn as of June 2010, highlighting how overcrowded the market is. With so many funds available to the LP community and such a high level of capital being sought, it is vital that investors are well informed on the opportunities available and likewise essential that GPs are able to competitively market their funds.

Buyout vehicles target the largest amount of capital within the private equity universe, with the average size of a buyout fund in market standing at $852mn, with an aggregate $220bn being targeted by 258 buyout funds. There are presently 362 venture funds open for investment, representing an aggregate target size of $49bn, followed by 209 growth funds targeting a total of $67bn.

Among the largest funds in market are buyout vehicles Apax VIII and KKR North American XI Fund. Apax VIII is currently targeting €9bn and looking to invest in a variety of industry sectors, such as technology, healthcare and retail in Europe, while KKR North American XI Fund is seeking $10bn to invest in North American companies across a range of industries.

With so many options available to the investor community, there is a constant need for information to help with sourcing investments and asset allocation. As the fundraising conditions continue to be challenging, GPs also need to work closely with investors in order position their funds correctly and attract capital to their funds.

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