Japanese bank buys stake in Alternative Investment Capital

Sumitomo Mitsui Banking Corporation has acquired a 20% stake in the Japanese fund of funds manager, which is currently raising a global fund of funds targeting up to $250m.

Tokyo-based Sumitomo Mitsui Banking Corporation (SMBC) has bought a 20 percent stake for an undisclosed sum in Alternative Investment Capital (AI Capital), a Japanese private equity fund of funds manager. 

AI Capital will leverage SMBC’s customer foundations and networks within Japan to source opportunities in private equity funds through its fund of funds vehicles and advisory services, the firm said.

The stake was acquired from trading company Mitsubishi Corporation, Daido Life Insurance and Mitsubishi UFJ Trust and Banking Corporation, the financial services company’s trust banking arm. The trio now respectively hold 51 percent, 25 percent and 4 percent in AI Capital. SMBC has also appointed a part-time director to the firm.

AI Capital is currently raising its second global fund of funds, AIC-PCG Global Private Equity Fund II, which is targeting between $200 million and $250 million, a spokeswoman said.

In 2004, it raised $152 million to invest in US and European funds. The firm presently manages another two Japan-focused fund of funds and has approximately ¥300 billion ($3 billion; €2.4 billion) in assets under management.

The founders of AI Capital also raised a Japan-focused fund of funds in 2000, prior to the firm being established.

A subsidiary of Sumitomo Mitsui Financial Group, SMBC is one of the largest banks in Japan.