A total of 1938 funds are currently chasing an aggregate $664.1 billion from investors. Of these, 627 list Asia-Pacific- amongst others- as a destination for future investments. 426 funds in market will be focusing entirely on the region, perhaps suggesting that GPs have not been put off by the slowing rate of Chinese economic growth.
Carlyle’s fourth and TPG’s sixth Asian vehicles are in market to raise the most amount of capital out of all APAC focused funds, each targeting $3.5 billion. Interestingly TPG’s previous Asian vehicle raised $3.8 billion, but it did close before the financial crisis. The previous fund in Carlyle’s Asia series closed in October 2010 but only managed to collect 51 percent of its $5 billion target. The China Development Industrial Bank, Maine Public Employees’ Retirement System (MainePERS), and the West Midlands Pension Fund backed the fund.
Although foreign GPs are aiming to raise the largest funds for the region, 81 percent of APAC focused funds in market are being raised by local managers. Examples include the Ambit Pragma Fund II and the Sailing New Culture Private Equity Fund I, which are targeting $150 million and ¥1000 respectively. This highlights the importance of local knowledge when investing into emerging markets.
In a recent conversation with the Research and Analytics team, Azure Partners, an emerging market focused fund of funds manager, said that countries within the Asia-pacific present the best opportunities going forward. This would indicate that all of the aforementioned funds should be able to capture interest from the global LP community.