Private equity firm Blackstone Group is expecting its latest buyout fund to be more than $13 billion in size, according to a source who has seen a letter it sent to investors dated Tuesday.

The fund has been raised during one of the toughest periods to ask investors for cash and investors have been eagerly awaiting a final figure of how much Blackstone raised.

The buyout firm had targeted June 30 to close -- or finish raising capital for -- the multibillion-dollar fund. In the letter to investors, it said it has completed active marketing of the fund, called BCP VI, and held a closing on June 30, the source said.

Some investors are still working to finalize documentation to invest in the fund, the letter said, according to the source. When these outstanding commitments are completed, Blackstone expects the total size of the fund will be in excess of $13 billion, the person said.

Blackstone declined comment.

The fund contrasts with its giant fifth fund, BCP V, a $21.7 billion fund it finished fund-raising for in the summer of 2007, which is invested in companies such as Nielsen, Freescale Semiconductor and Hilton Hotels.

Private equity firms raise capital from investors such as pension and endowment funds. They typically spend several years investing that capital by buying companies, with the aim of selling or floating those assets and generating an outsized return.

Since the credit crisis squeezed investors' purse strings, the time it has taken to raise funds has lengthened and the amount firms have been able to raise has slid.

Pension and endowment investors, who took a large hit on their equity portfolios, have been unwilling to commit fresh capital. Buyout firms also had less need for capital as fewer deals were done.

Blackstone began raising BCP VI about two years ago -- an increasingly tough period to ask investors for cash. It did not publicly disclose a target when it started raising the fund, although research from London-based research firm Preqin dated 2008 put the target at $20 billion.

Blackstone itself has committed up to $750 million to the fund, it told investors in a recent presentation obtained by Reuters. That means it will likely be the largest investor in the fund, the presentation said.

The company in addition has a vast amount of "dry powder" -- capital available for investment -- from previous funds raised. It said in April it had $27 billion of dry powder to invest, of which $3 billion was in BCP V.

Blackstone's credit unit, GSO Capital Partners also just finished raising a fund -- bringing in $3.25 billion and above the original target of $2 billion.

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