Within the last quarter of 2011, 24 private equity funds that have a predominant focus on Asia-Pacific reached final close, excluding real estate and infrastructure funds, raising an aggregate $7.4bn. China-based fund managers dominated the list, with 11 of these funds from the country, while the remaining 13 are managed by GPs headquartered in Australia, Germany, Japan, India, Malaysia, Singapore, South Korea and US.
The top five largest funds closed in Q4 2011 were Hony Capital RMB Fund II, Archer Capital Fund V, Shanghai Ruili Emerging Industries Parallel Fund I, New Horizon Capital IV and Tianjin Junruiqi Private Equity Partnership.
The biggest fund, Hony Capital RMB Fund II, which is managed by China-based buyout specialist Hony Capital, was oversubscribed at $1.6bn. The fund is set to target buyout opportunities in a diversified array of industries within China; however it may also make selective investments in overseas companies that can add value to the Chinese market.
Archer Capital Fund V, another buyout vehicle, was the second largest fund closed by attracting $1.5bn from investors. Raised by Australian manager Archer Capital, the fund will invest across all industries except real estate and commercially unproven technology businesses. It mainly seeks opportunities situated in Australasia and New Zealand.
The next largest Asia-Pacific vehicle to close in the quarter was the $1.1bn Shanghai Ruili Emerging Industries Parallel Fund I. The fund is managed by Shanghai Ruili Investment Fund Management, a subsidiary of Shanghai International Group (SIG) that is headquartered in Shanghai and is denominated in both CNY and USD. The fund will invest predominantly in companies based in Shanghai.
Trailing closely behind is New Horizon Capital IV, a China-focused growth fund managed by New Horizon Capital. The fund is just over $1bn in size and will invest in leading players in industries, such as consumer services and products, energy, pharmaceuticals and retail.
The fifth largest fund closed in Q4 2011, Tianjin Junruiqi Private Equity Partnership, is a $522mn venture fund. Managed by China-based Legend Capital Management, the vehicle will focus on six main industries within China, namely technology, media and telecoms (TMT), modern services, clean technology, healthcare, consumer-related services and advanced manufacturing.
Looking forward, there are currently more than 290 private equity funds seeking more than $82bn in capital that have a predominant focus on Asia-Pacific, excluding real estate and infrastructure funds.