Creador hits $500m first close on Fund V
Creador has reached a first close of $500 million on its fifth South and Southeast Asia-focused fund, with the first three investments set for completion in August.
The fund launched in March with a target of $600 million and the hard cap has been set at $680 million, according to a source close to the situation. Most of the LP commitments in the first close are re-ups. To the extent there are new investors, they are groups that have been tracking the manager for several years and are comfortable with virtual due diligence, the source added.
A second source close to the situation said that Creador was focusing more on direct asset owners rather than fund-of-funds, limiting the latter to two in Fund V. The decision was partly driven by concerns about the extent to which fund-of-funds add value and the need to accommodate their co-investment expectations.
Creador declined to comment on fundraising.
The private equity firm closed its fourth fund at $580 million in 2019, having increased the hard cap from $550 million. This continued a trend of increased fund sizes with each vintage and relatively rapid deployment. Creador raised $130 million for its debut vehicle in 2013, closed the second at $330 million in 2014, and secured $419 million for the third two years after that.
Since its inception, Creador has invested one-third of its capital in Malaysia, one-third in India, and one-third in Indonesia, the Philippines, and Vietnam. Fund V will follow a similar pattern, with the Philippines and Vietnam primarily addressed on an opportunistic basis.
The goal is to write checks of $30-80 million for mid-cap businesses across the consumer, healthcare, financial services, and business services spaces. Recent activity – from Fund IV – includes paying $50-60 million for a 30% stake in Tealive, a Malaysian teashop brand that is eying international expansion, and a $34 million commitment to India-based pharmaceutical packaging supplier Shriji Polymers.
In terms of exits, three months ago Creador sold a minority interest in Indian drug components manufacturer Corona Remedies to ChrysCapital Partners, delivering a 3.7x multiple and a 32% IRR.
Meanwhile, Malaysia-based credit bureau CTOS Digital – a Fund II investment from 2014 – will go public next week following a MYR1.2 billion ($286 million) IPO. Creador is expected to take MYR792 million off the table, reducing its 80% stake by about half. Last October, the private equity firm was responsible for Malaysia’s biggest listing in three years as Mr DIY raised MYR1.5 billion.
Other recent Southeast Asia PE fundraising activity includes first closes of $100 million and $250 million, respectively, by KV Asia Capital and Tower Capital. Both are targeting $300 million – KV for its second fund and Tower for its first. Novo Tellus Capital Partners closed its second Southeast Asia fund at $250 million at the end of last year.
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