Gavea trumps BTG with record Brazil fund

Brazilian bank BTG Pactual and Rio-based investment group Gavea Investimentos have raised buyout funds totalling $3.3bn, underlining the growing interest in Latin American private equity.

Both BTG Pactual and Gavea Investimentos have raised private equity funds for the region, with Gavea trumping its peer’s effort according to a source close to the fundraising.

The fundraisings come just two weeks after US alternative asset manager The Carlyle Group closed two Latin American vehicles totaling $1 billion. Brazilian group Vinci Partners' also closed its first private equity fund on $1.4 billion earlier this month, according to trade body the Latin American Venture Capital Association.

BTG Pactual closed its latest private equity fund earlier this week with $1.5 billion raised, according to press reports. It took just six months to raise the capital, and exceeded its target by more than 30 percent. A BTG spokesperson did not return calls.

Gavea, meanwhile, has surpassed BTG’s effort in raising a $1.8 billion fund. The group, backed by JPMorgan’s Highbridge Capital Management, is to hold a final fundraising close this week according to a source close to the process. Gavea could not be reached for comment.

The Gavea fund will set a benchmark for the biggest vehicle raised for private equity investment in Latin America.
The existing record is held by Argentina-based Southern Cross Group, which raised $1.68 billion last year for Southern Cross Latin America Private Equity Fund IV. That narrowly surpassed Advent International’s latest Latin American vehicle, its fifth, which closed on $1.65 billion last April.

BTG sold a 19 percent stake in itself in December to a consortium of investors including Singapore sovereign fund GIC, the China Investment Corporation, Canadian fund Ontario Teachers’ Pension Plan Board, the Abu Dhabi Investment Council and private equity firm JC Flowers in a deal worth about $1.8 billion.

BTG has already begun investing its latest fund, acquiring pharmacy chain Brazil Pharma and oil services group Brasbunker.

PEI will be hosting its second Brazil Forum in Rio de Janeiro on October 26-27.