The Carlyle Group is targeting R$1 billion ($450 million, €320 million) for its second Brazil-focused fund, according to two sources with knowledge of the situation.
Carlyle declined to comment.
The fund launched during the first quarter and all of its limited partners will be Brazilian investors, according to the source. The fund could receive a substantial commitment from Previ, the pension fund for employees of Banco do Brasil, which reportedly has R$1 billion to invest in private equity funds this year.
Carlyle partnered with Banco do Brasil for its prior Brazil fund, Fundo Brasil de Internacionalização de Empresas (FBIE), which closed on R$360 million in 2011, according to a statement. FBIE was raised alongside the firm’s pan-regional vehicle, Carlyle South America Buyout Fund, which closed on $776 million.
Carlyle’s new Brazil fund will largely follow the same investment strategy as FBIE, which invests in Brazilian companies in a number of sectors, including consumer and infrastructure, according to one of the sources.
FBIE is not fully invested, but its portfolio includes women’s lingerie manufacturer and retailer Scalina, retail toy chain Ri Happy and furniture retailer Tok and Stok, according to Carlyle’s website. Carlyle reportedly exited private health insurance provider Qualicorp. The firm also listed Brazil’s largest tour operator CVC Brasil Operadora e Agencia de Viagens SA on the Novo Mercado market in December 2013.
Carlyle plans to focus its emerging markets investments in the next few years on China and Brazil, co-founder David Rubenstein recently told attendees at the Associação Brasileira de Private Equity e Venture Capital private equity conference in Brazil earlier this month.
Carlyle’s South America buyout team is led by managing directors Fernando Borges, the former chief executive officer of AIG Capital Investments do Brasil; Juan Carlos Felix, previously a partner at McKinsey & Company; and Fernando Pinto, who worked at investment management organisation Capital International Research. The team was established in 2007 and operates in Lima and São Paulo.