One hundred and seven private equity fund managers are headquartered in Australia, 42 of which either specialize in buyout investments or participate in buyout deals as part of a broader investment strategy. These 42 GPs have successfully garnered $26.1bn in LP commitments over the past 10 years. In terms of dry powder, an estimated $8.7bn worth of capital commitments has yet to be called up by Australian fund managers that pursue buyout deals. Sixty-eight percent of the available dry powder will be allocated to only Australasian companies. Another 13% will be invested in both Asia and Australasia while the remaining 19% will be made available to both Australasian and non-Australasian markets.
The largest three Australia buyout fund managers by aggregate capital raised in the last 10 years are Pacific Equity Partners, Archer Capital, and Champ Private Equity.
Founded in 1997, Pacific Equity Partners raised close to $5.0bn in capital commitments via its Pacific Equity Partners series of buyout funds, and has approximately $1.3bn in estimated dry powder. Its most recent vehicle, Pacific Equity Partners Fund IV, was the largest private equity fund raised to date by an Australian fund manager, securing approximately AUD 4.1bn ($3.7bn) in 2008. Pacific Equity Partners focuses on both buyout and growth capital investments in Australia and New Zealand companies.
Archer Capital has garnered $3.5bn in aggregate capital commitments in the past 10 years, and is expected to actively seek small to mid-cap deals in the Australian market following the AUD 300mn ($307mn) final close of Archer Capital Growth Fund 2 last month. It also completed an AUD 1.5bn ($1.5bn) fundraising campaign for Archer Capital Fund V in 2011. With an estimated $1.9bn of capital commitments that have yet to be called, Archer Capital will be targeting buyout and growth capital opportunities within Australasia. While Archer Capital Growth Fund 2 invests in businesses that are worth between AUD 20mn and AUD 150mn in enterprise value, Archer Capital Fund V focuses on larger companies whose enterprise values average between AUD 200mn and AUD 700mn.
Champ Private Equity’s latest vehicle CHAMP Buyout III closed in 2010 having raised an approximate AUD 1.5bn ($1.5bn) in capital commitments. To date, the aggregate capital raised by the Sydney-based fund manager in the past decade amounts to $2.2bn. CHAMP Private Equity has a predominant focus on the Australasian market and also makes opportunistic investments in Asia. Its estimated dry powder level stands at $982mn and the firm will be targeting mid-market management buyouts in companies that are worth between AUD 150mn and AUD 750mn in enterprise value.