DRC Capital downsizes Fund II target

The Japanese private equity firm has shaved off $50m from its target for DRC II, which it aims to close soon on $100m.

Tokyo-based DRC Capital aims to hold a final close for JLP DRC II on $100 million, down from its original target of $150 million, an industry source told PE Asia.

DRC declined to comment.

In December last year, a source told PE Asia that the firm had garnered about $75 million and expected a final close at the end of the first quarter this year.

However, due to the 11 March earthquake and the subsequent tsunami and nuclear situation, many LPs have been in the “wait-and-see mode”, according to the source.

“LPs are not concerned about Japan’s private equity in general, it’s just that they see some uncertainty at the moment,” the source added.

But even putting the earthquake aside, fundraising remains the biggest challenge for a number of Japanese GPs currently marketing their funds to foreign LPs for the first time.

In a recent interview with PE Asia, Hideaki Fukazawa, president and managing partner at Tokio Marine Capital, said foreign LPs’ biggest question was whether or not there were deals in Japan.

DRC launched its JLP DRC I in 2007 and the fund closed on ¥4.3 billion. Previously, the firm raised two funds under the name of ACTIV Investment Partners. According to the firm's website, the two funds made four investments in total and generated a gross internal rate of return of 37 percent.