US private equity investor HarbourVest Partners has held a final close of its fourth fund, HarbourVest International Private Equity Partners IV, raising $2.8bn.
The fund is split into two offerings, fund of funds and direct investments. The fund of funds raised $2.425bn with the direct investment pool making up the remainder ($375m). Investors were able to invest in any combination of the two funds.
The fund, which will target investments around the world, has committed just under 25 per cent of its capital since investing commenced in February 2001. “We have a global remit although around 90 per cent of the total capital committed to date has gone to Western European funds,” said George Anson, partner at the firm’s UK office.
The firm has not disclosed the identity of the fund's investors, although over 50 per cent of the capital was committed by previous investors. “We have a good cross-section of investors,” added Anson. “Around 50 per cent came from European pension funds and financial institutions, with the remainder coming from the US.”
In addition to making direct investments and commitments to venture capital and private equity funds, the fund will also target the “very active” secondaries market. A growing number of market participants see the ever increasing amount of capital being placed in secondary funds (the most recent final close being at E2.54bn for Coller Capital) to be an indication that the search for liquidity by some limited partners offers compelling buying opportunities. Commented Anson: “It is not the most publicised market but there is a lot of scope for secondary investments in the current environment.”
The new fund exceeds the total raised for HarbourVest’s third fund, which raised $2.1bn. “I think investors are aware of the increased opportunity in the current market which is reflected in the fact that we exceeded our target,” said Anson.