CVC to launch $3bn Asia fund

CVC Capital Partners intends to launch its fourth Asia fund in June, targeting $3 billion, a source with direct knowledge of the matter has confirmed to Private Equity International. 

A spokeswoman for the firm declined to comment on fundraising.

The new fund will have a mandate to invest in Asia including Japan, but will not invest in Australia, the source said.

CVC closed its Asia Fund III, with a 2008 vintage, on $4.12 billion, according to PEI’s Research and Analytics division.

In the last 18 months, the firm has had four exits from Fund III, including the March sale of a 40 percent holding in Indonesia’s Matahari department store chain for $1.3 billion, bringing an estimated 3x multiple, PEI reported earlier. 

However, last October, CVC ceded control of Australian media group Nine Entertainment as part of a $3.4 billion debt-for-equity swap, which represents the Asia-Pacific region’s biggest ever private equity write-off.

According to PEI's source, the firm’s limited partners have said that Fund III has the highest IRR in Asia for its vintage, despite having some exposure to the Nine Entertainment write off (the bulk of the investment came from the firm’s other vehicles).

CVC joins Kohlberg Kravis Roberts, Bain Capital, TPG, Affinity Equity Partners and others who have raised or are raising multi-billion funds for the region.

A firm’s ability to manage investments successfully through the years following the Lehman-sparked crisis is increasingly becoming a benchmark for LPs when choosing funds, according to industry sources.