Halusa: $100bn fund on horizon

Apax Partners chief executive Martin Halusa reportedly told The Times at the World Economic Forum in Davos, Switzerland that he can envision a firm raising as much as $100 billion (€81.7 billion) within the next decade.

Martin Halusa, chief executive, Apax Partners

The report has created the same kind of buzz in the private equity arena that Piper Jaffray’s $600 per share Google forecast caused on the public market a few months back.

Ten years ago, many industry observers would have scoffed at the idea of a $10 billion private equity fund. Today, however, firms such as the Blackstone Group and Apollo Management can sprint past that mark without so much as a sweat.

For an industry that has always dealt with the complaint that there is “too much capital, chasing too few deals”, the very idea of a $100 billion fund seems unfathomable. One industry publication reported in March of 2005 that the aggregate capital overhang for private equity as an industry was just $99 billion.

Although that number has surely climbed in the past 10 months, it does provide an idea of how large a $100 billion vehicle would actually be, as one fund would theoretically eclipse the entire market as it stood one year ago.

But while the $100 billion plateau sounds out of reach today, it would conceivably just move the industry further up the food chain. Deals for the likes of General Motors could become a reality, and the necessity to arrange a syndicate of equity providers would be a thing of the past.