Fundraising on course for post-crisis record in 2013

Private equity fundraising stood at roughly $269bn at the end of the third quarter - with the UK particularly buoyant - and looks set to record its highest annual total since the financial crisis.

Private equity funds raised $83.9 billion during the third quarter of 2013, bringing the total raised this year to $275.2 billion, according to data from Private Equity International’s Research and Analytics division

The amount of capital raised by funds that held a final close in the first three quarters of this year means the industry is on track for its biggest year of fundraising since the financial crisis, according to PEI data – outstripping the $302 billion collected in 2012. 

Nearly 60 percent of the capital raised during the third quarter went to the 10 largest funds. The largest to close during the quarter was CVC European Equity Partners VI, which collected $14.2 billion for pan-European investment. 

This also helped push the total raised by UK-based funds to $51.9 billion in the year to date – equivalent to about 93 percent of the total they raised in 2008, before the crisis hit. That means the UK could finish this year as one of the few countries globally to see fundraising levels top pre-crisis levels.

Overall, fundraising is still lagging well behind the levels of 2008, when 881 funds collected a total of $531.8 billion.

“Private equity fundraising remains a long way off pre-crisis levels , but these figures demonstrate a continued re-strengthening of appetite for the asset class,” said Dan Gunner, director of PEI’s Research and Analytics. “That said, the fundraising market does remain split and it’s the established names, the likes of CVC and KKR, that are having success and having it quickly. A good number continue to struggle.”

The sheer volume of funds currently in market suggests that GPs are planning to test this renewed appetite to the full. More than 1,700 funds are targeting a total of $838.1 billion, with at least four buyout funds aiming to raise $10 billion or more. 

PEI’s fundraising data do not include funds that held interim closes during the first six months of the year.