PAG targets $3b for second Asia fund

A hard cap has yet to be set for the new vehicle, sources familiar with the situation told AVCJ. 

The first fund launched in late 2010 and reached a first close of $1.7 billion in seven months. At the time, PAG had already secured sufficient commitments for the entire vehicle. LPs include California Public Employees' Retirement System (CalPERS) and California State Teachers' Retirement System (CalSTRS).

PAG targets buyouts and control deals as well as structured investments. It typically invests at least $100 million in equity per deal and focuses on sectors that leverage private consumption, notably consumer and retail, food and beverages, financial services, healthcare, and media and entertainment.

As of December 2014, the first fund had nine portfolio companies. Seven of them were China-based, including: mobile phone retailer Funtalk China, which was taken private in 2011; drug developer Bicon Pharmaceutical; and brokerage Haitong Securities, which brought in PAG as an investor in its IPO. The non-China deals are theme park operator Universal Studios Japan and property services business DTZ.

Subsequent investments include South Korea-based Young Toys. PAG is understood to have bought the business from Headland Capital Partners for around $200 million.

Three companies had been exited as of December 2014 - Funtalk, Bicon and Haitong - resulting in distributions of about $1 billion. At that time, Fund I was said to have so far generated a multiple of 1.5x and a gross IRR of 25%.

Asia-focused private equity funds raised a total of $18.5 billion in the first four months of 2015, according to AVCJ Research. This compares to $65.5 billion for 2014 as a whole. Recent substantial fund closes include Baring Private Equity Asia, which raised $3.99 billion for its sixth regional fund, while RRJ Capital is currently in the market seeking around $4 billion.

PAG has real estate and absolute return strategies in addition to private equity. The firm has more than $11 billion in assets under management and employs over 300 people, with offices in Hong Kong, Shanghai, Beijing, Shenzhen, Tokyo, Seoul, Singapore and Sydney.

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• Topics
• Fundraising
• Greater China
• North Asia
• Australasia
• Southeast Asia
• Buyout
• PAG
• Weijian Shan
• Fundraising
• Asia
• buyout