If Private Equity International gave out an award for the biggest store of dry powder, Blackstone would take first place.
The New York-headquartered alternatives giant had $127.2 billion of capital to spend across alternatives at the end of Q3 – more than 14 percent higher than its closest competitor, KKR, which had $111 billion.
Several of Blackstone’s drawdown funds are deploying capital faster than original expectations and were more than 50 percent committed as of the end of September, Jon Gray, president and chief operating officer, said on an earnings call in October. Q3 was the firm’s busiest ever quarter, with $37 billion invested and an additional $30 billion committed to pending deals.
“The timing of successor funds will be a function of investment pace. Together with our growing menu of perpetual strategies, the outlook is positive,” Gray said.
Arizona State Retirement System‘s executive director Paul Matson said there was an estimated $1.5 trillion in industry-wide dry powder across buyouts, growth and fund of funds strategies, speaking at the pension’s investment committee meeting this week.
More than one-third of respondents in law firm Dechert’s 2022 Global Private Equity Outlook report, out this week, said the amount of unspent capital has meant fiercer competition and higher entry prices.
“If you’re in an auction right now, it’s extremely competitive. You almost have to pre-empt it in order to win,” said Markus Bolsinger, co-head of Dechert’s PE practice, in the report. “You have to pay at the very top end, and leaning on your existing relationships is becoming increasingly important.”
See below how the main listed private equity firms’ dry powder amounts stack up: