RRJ readies $2.5bn first close

The Richard Ong-led private equity firm will do a first close this month on its $4bn Asia vehicle just two months after launching the fund. Temasek, an LP, made the largest investment ever into a single fund.

RRJ Capital has raised between $2.5 billion to $3 billion and is planning a first close this month for its second Asia-focused vehicle, PE Asia has learned. The fund is targeting $4 billion and has a hard-cap of $5 billion, one of the biggest funds dedicated to the region ever.

RRJ declined to comment.

Singaporean sovereign wealth fund Temasek anchored the fund with “the biggest ever LP investment globally into a single fund”, a source close to the matter told PE Asia. Temasek, where RRJ co-chairman and co-chief executive Charles Ong worked for 10 years, was also an investor in the firm’s first fund.

Most LPs from RRJ’s first fund have re-upped, with some still planning to come in the second round of fundraising. The firm expects to have more North American LPs in the new fund and has also received offers of commitments from a number of key Chinese LPs including the China Investment Corporation.

The firm’s first vehicle, with total commitments of $2.3 billion, is now approximately 70 percent deployed. PE Asia can also reveal the firm closed its first healthcare deal in China last week, investing $50 million from its first fund.

The new fund will have a similar strategy to its predecessor, focusing on China and Southeast Asia, but has a mandate to invest in more buyout opportunities. It will do deals between $50 million and $3 billion.

RRJ’s mandate also allows the firm to invest in other geographies as long as the company has a strong Asian element, for example plans to expand into Asia. So far, outside Asia RRJ has only invested in the US including its $468 million investment in liquefied natural gas export plant Cheniere Energy Partners with Temasek in May. CIC and the Government of Singapore Investment Corporation later jointly invested $1 billion in the company.

The firm's key markets are China, Indonesia, Malaysia and opportunistically some other Southeast Asian markets, but it will not invest in India at all. According to the source, the firm’s deal pipeline is strong, with “a few buyouts in the pipeline” both in China and Southeast Asia but it “feels no pressure” to close a deal immediately.

RRJ Capital was formed in 2011 after co-founder and co-chairman Richard Ong, formerly head of Asia investment banking at Goldman Sachs, spun out of his private equity firm Hopu Investment Management. The firm is run by the Ong brothers and is based in Hong Kong.