Baring Private Equity Asia (Baring Asia), which has lately become quite active in India, has raised $3.98 billion in its new flagship fund, taking its total assets under management to around $9 billion, it said in a press statement.
The new fund christened Baring Asia VI is believed to be the largest PE Fund ever raised by an Asia-based PE firm.
Baring Asia is separate from Baring Indian Private Equity, which runs an independent India-dedicated PE unit. However, the two use common logo in their branding.
Baring Asia’s new fund had hit first close at $3.3 billion last year within four months of launching, and closed at its ‘hard cap’ after heavy over-subscription. Baring Asia said Fund VI will target companies in Asia, as well as those in Europe and North America with growth plans in Asia, in a broad range of sectors.
Jean Eric Salata, founding partner and CEO of Baring Asia said, “We are very grateful for the support we received from both our existing investors and the many new investors that chose to commit to Baring Asia VI.”
Commenting on the new fund being 60 per cent larger than its predecessor raised in 2011, he said, “Although there was demand for a substantially larger fund, we capped capital commitments at a level we were comfortable we could invest well. We are seeing many more situations involving large scale companies and more control deals than we used to, so we expect the average investment amount per company also to be larger.”
Today Baring Asia has a team of 110 across Asia, twice the size at the close of its previous fund.
The firm said investor commitments came from institutional investors across the globe including North American pension funds, Asian and Middle East sovereign wealth funds, endowments and fund-of-funds.
The over-subscribed fund consisted of many existing investors as well as several new investors. The firm’s own partners are committing $138 million, making them one of the largest investors in Fund VI.
Since its inception, Baring Asia has invested in 72 companies with transaction values totalling $11 billion.
The firm has been investing in Asia since its formation in 1997 and has seven offices in Hong Kong, Shanghai, Beijing, Mumbai, Singapore, Jakarta and Tokyo. It currently has over 30 portfolio companies across Asia with a total of 95,000 employees and sales of approximately $30 billion in 2014.
In India it has struck two significant deals in the last couple of years including a control deal involving public listed IT services firm Hexaware and a stake in Indian unit of cement major Lafarge. As first reported by VCCircle, it is also in an advanced stage of discussions to acquire around 9-10 per cent equity stake held by financial services company IDFC Ltd in the Mumbai-based brokerage firm Sharekhan Ltd. It had first invested in the brokerage firm in February 2008 picking 12 per cent equity stake in Sharekhan for Rs 240 crore through a mix of stake purchase from CVCI and issue of fresh securities.
In the past it has also invested in firms like Global Indian School Education, Coastal Projects, KS Oils, RSP Design, Rithwik Projects, Karvy Stock Broking, Pratibha Syntex and Bhushan Power & Steel. Although it has struck some part-exits in the past it is yet to clock a major exit from India portfolio. However, this may change with the impending global merger between Holcim and Lafarge which is expected to generate a neat exit with juicy returns for its special situation type deal.
Meanwhile, Baring Asia’s new Asian fund follows several large funds for the region raised by other global funds. In September 2014, Carlyle closed its fourth Asia fund Carlyle Asia Partners IV at $3.9 billion, what was then the second-largest private equity fund ever raised for Asia investments. In March 2014, TPG Capital raised $3.3 billion in its sixth Asia-focused buyout fund. In July 2013, KKR raised a record $6 billion Asia fund.
(Edited by Joby Puthuparampil Johnson)