Funds

Apax amasses $7bn for Fund IX – Exclusive

The firm has held an initial close on the vehicle, which is targeting around $7.5 bn.

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Apax Partners has amassed $7 billion for its latest flagship buyout fund, Private Equity International has learned.

The firm held an initial close on Apax IX on 20 May, with commitments reaching $7 billion, according to sources with knowledge of the fundraising. This initial close will allow the firm to begin investing the fund, but it is not an official first close.

Apax declined to comment on fundraising.

In January PEI reported that Apax had officially launched the fund, which is targeting $7.5 billion. It is understood that the firm has yet to set a hard-cap.

Apax is offering LPs in Fund IX the choice of either a deal-by-deal carried interest distribution or the more typical European-style fund model, in which carry is not distributed until all drawn down capital is repaid to investors and the preferred return is met. It is understood that investors opting for the deal-by-deal structure will receive a discount on the management fee.

Apax has returned a total of $18 billion to its investors since January 2014 through a string of exits which have delivered an average gross money on invested capital of more than 3x and an average gross internal rate of return of 27 percent, according to sources familiar with the matter.

In December Apax sold Rhiag-Inter Auto Parts Italia to LKQ Corporation in a deal valuing the business at €1.04 billion. Rhiag is a business-to-business distributor of aftermarket spare parts for passenger cars and commercial vehicles. In November 2015 Apax offloaded its final stake in New York-listed King Digital Entertainment. The transaction netted the firm a gross MOIC of 93x and an IRR of 55 percent, as reported by PEI.

Apax is one of several European mega-firms that have been on the fundraising trail recently. In April PEI reported that Cinven had raised more than €7 billion for its latest flagship vehicle, the Sixth Cinven Fund, and was expected to reach a final close within weeks. Meanwhile BC Partners is still on the road seeking €7 billion for its tenth vehicle, and Permira is looking to raise €6.5 billion for its sixth flagship fund, as reported by PEI.