Blackstone closes Fund VII on $18bn

The fund exceeded its $17.5bn hard-cap with commitments from more than 250 LPs and $500m from the firm and its employees. It will begin investing in the first quarter of 2016.

Global private equity firm Blackstone has held a final close for its most recent global private equity fund, Blackstone Capital Partners VII, on $18 billion.

The fund received commitments from more than 250 limited partners in 40 countries and reached its hard-cap of $17.5 billion, according to a statement from the firm. It held its first close on $15.7 billion in May.

The firm said it expects to start investing the capital raised for Blackstone Capital Partners VII in the first quarter 2016.

It began fundraising for Blackstone Capital Partners VII in November 2014 as private equity firms reached new fundraising records following the global financial crisis.

Some of the investors in the new fund include the California Public Employees’ Retirement System, the Oregon Public Employees’ Retirement System, the Oregon State Treasury and the Washington State Investment Board, each of which committed $500 million, according to PEI’s Research & Analytics division.

Blackstone and its employees also committed $500 million to the fund to bring the total amount to $18 billion.

The fund’s predecessor, Blackstone Capital Partners VI, closed in 2012 on $16.27 billion, according to PEI Research. The fund generated a total net internal rate of return (IRR) of 12 percent and a realised net IRR of 47 percent as of 30 September, according to a Blackstone quarterly filing with the US Securities and Exchange Commission.

Fund VI received commitments from the four LPs mentioned above as well as others such as The Hearst Foundations, the Kuwait Fund for Arab Economic Development, China Development Industrial Bank and Fubon Life Insurance, according to PEI Research.

Blackstone had previously raised a bigger fund than its latest one: Blackstone Capital Partners V closed on $21.7 billion in 2007 at a time of peak fundraising levels prior to the global financial crisis. Its realised net IRR as of 30 September was 10 percent, according to the firm’s SEC filing.

A spokesman for the firm was not immediately available to comment on the new fund.

Blackstone manages over $330 billion in assets, of which $91 billion of equity is managed by the firm’s private equity arm as of the third quarter.

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