Carlyle raises $1bn for South America

The alternatives manager has held final closes for two South American vehicles with a Brazilian focus, bringing its total assets under management in emerging markets to $14bn.

The Carlyle Group has held final closes for two funds totalling $1 billion for South America: Carlyle South America Buyout Fund and a fund raised in partnership with Banco do Brasil. The amount raised was double the amount initially targeted by Carlyle, the firm said in a statement.

The fundraisings bring Carlyle’s assets under management in emerging markets to $14 billion, which represents 13 percent of its overall group-wide AUM. 

Carlyle has joined other prominent globally-focused firms in targeting Latin American, and Brazil in particular. Advent International has long operated in the region, closing its fifth Latin American fund on $1.65 billion last year. The Blackstone Group purchased a stake in local fund manager Patria Investimentos last year, while UK-listed 3i recently opened an office in Sao Paulo, as did Swiss alternatives manager Partners Group. Apax Partners also recently inked its first Brazilian deal. 

Carlyle’s South America Buyout Fund, which garnered $776 million in commitments, is a pan-South American fund with a principle focus on Brazil, the firm said. It will be used to fund buyouts and growth capital investments.
The fund raised in partnership with Banco do Brasil raised R$360 million ($225 million), and will invest alongside CSABF, Carlyle added.

Fernando Borges, a managing director at Carlyle and the head of its South America buyout team, said: “Our ability to raise double our original fund target demonstrates the significant opportunity of the South America market. Broad economic trends, including the rising middle class, make South America in general and Brazil in particular a desirable investment destination.”

David Rubenstein, co-founder of Carlyle, added, “Fernando and his colleagues have done a spectacular job simultaneously raising and deploying capital. South America is a vital part of our broader emerging markets strategy.”

Carlyle’s nine-strong South America team is based in Sao Paulo, Brazil and was established in 2008. It has completed three deals since its inception, deploying almost $1 billion in equity. The firm also plans to open an office in Peruvian capital Lima before the end of this year, having agreed a joint venture with Peruvian financial services group Credicorp in March.