Asia Alternatives closes fourth vehicle on $1.8bn

The investments will take a pan-regional approach to Asia

Asia Alternatives, an Asian private equity fund of funds has closed its fourth vehicle – Asia Alternatives Capital Partners IV on $1.8 billion.

Asia Alternatives Capital Partners IV is the largest of the funds, which closed on $1 billion along with a sleeve fund focused on investments outside of Japan, beating its $750 million target. The remaining funds will be included in separately managed funds of one, with the same investment strategy.

AACP IV is 20 percent larger than its predecessor vehicle which closed on $1.5 billion in 2012.

The funds are focused on building a diversified portfolio with an emphasis on top performing local Asian fund managers. Investment areas will include greater China, Japan, Korea, South East Asia, India and Australia. The strategies are heavily weighted toward buyout funds, but venture capital and special situations managers are also represented.

Known investors in the fund include the Florida State Board of Administration, New York State Common Retirement Fund, and the Teachers’ Retirement System of the State of Illinois.

“Our portfolio construction is all about risk adjusted return. We have very different types of markets in Asia that are more emerging, to more developed. The market conditions in each individual country are constantly changing,” Melissa Ma, co-founder and managing director of Asia Alternatives told Private Equity International of the fund.

General partners in Asia Alternatives’ vehicles include China's CDH Investments, Boyu, N5, Boxin, and Hony Capital, India's Tano Capital, ChyrsCapital and CX Partners, Indonesia’s Northstar Capital and Saratoga Capital, Japan's Unison Capital and MBK Partners. The firm has invested in over 40 managers in Asia since inception.

“This is the largest co mingled pool of new commitments we have raised so far,” Ma added. “The opportunity set for Asia private equity is continuously evolving.”