Australia's BGH closes debut fund at $2b hard cap

The vehicle launched in September 2017 with a target of A$2 billion and reached a first close of A$2.2 billion in February. Investors told AVCJ in January that the hard cap had been set at A$2.5 billion.

The LP base comprises public and private pension funds, sovereign wealth funds, insurance companies, endowments, foundations and family offices. However, BGH is said to have largely avoided Australian investors, with AustralianSuper the sole significant domestic participant.

The private equity firm offered an insight into its backers by identifying several co-investors in its first deal. AustralianSuper, GIC Private, Ontario Teachers’ Pension Plan (OTPP), and Canada Pension Plan Investment Board (CPPIB) are all taking part in a proposed A$4.1 billion buyout of Australian hospital operator Healthscope. Gray previously privatized the company and then relisted it while at TPG.

Healthscope likely represents the top end of BGH’s deal range. The GP said in a statement that it would primarily target mid-market transactions while maintaining the flexibility to execute large buyouts or smaller growth deals. It prefers situations where there is a significant opportunity to support growth or effect operational improvement.

The other founding partners are Simon Harle, who spent over 10 years with TPG, leading Australia investment activity as part of the team that Gray established, and Robin Bishop, who was previously head of Australia and New Zealand at Macquarie Capital. In their prior roles, they led approximately A$3 billion of equity investments across a broad range of industries.

BGH has over 20 investment professionals in total. They include three additional partners: Terry Bowen, a former finance director of Wesfarmers, who leads the operations group; Stephanie Charles, an ex-Credit Suisse banker tasked with heading the capital markets team as well as making investments; and David Brooks, another former TPG executive in Australia.

BGH Capital Fund I is the largest ever first-time private equity fund focused on Australia and New Zealand, and the second biggest overall. Pacific Equity Partners raised A$4 billion for its fourth fund in 2007, comprising $2.7 billion in core equity and A$1.3 billion in non-discretionary co-investment capital. This structure was dropped for Fund V – co-investment is discretionary – which closed in 2015 at A$2.1 billion.

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• Topics
• Australasia
• Buyout
• Fundraising
• GPs
• Australia
• New Zealand
• BGH Capital