KV Asia closes debut fund above target at $263m - update

KV Asia reached a first close of more than $100 million last October, with LP contributions from Adams Street Partners, Hermes GPE and Morgan Stanley. The full roster of LPs includes pension funds, endowments, financial institutions and family offices.

"We are pleased with the positive response to our offering and the recognition we have received," said Karam Butalia, executive chairman of KV Asia. "We have a high caliber team and are now eager to execute on our commitment to help mid-sized companies grow through operational value-add and cross-border activity."

Butalia, former global head of Standard Chartered Private Equity, founded KV Asia in 2010 with Vibhav Panandiker, another SCPE alumnus, but more recently a managing director with J.P. Morgan Private Capital Asia. The firm has offices in Singapore and Jakarta.

In a difficult market for first-time funds, KV Asia's success is confirmation of the growing interest in Southeast Asia, seen by some as an alternative to region's major emerging markets, China and India. Investor sentiment has moderated on the former and deteriorated on the latter.

At the end of June Singapore-based Southern Capital Group (SCG) closed its third buyout fund at approximately $400 million, exceeding the $350 million hard cap. Whereas the firm's previous vehicles invested throughout the region, Southern Capital Fund III focuses on Malaysia, Singapore and Indonesia. Another Southeast Asian GP, Credence, reached a final close of S$200 million ($159 million) on its second fund in February.

According to AVCJ Research, commitments to Southeast Asia-focused funds reached $4 billion in 2012, the most in four years, although this doesn't reflect capital accumulated by pan-regional funds - many of which are staffing up in Southeast Asia - and single country vehicles.

Speaking to AVCJ last year, Butalia highlighted the benefits of a pan-Southeast Asia approach. "Many PE firms look at the region from a country level but we look at how we can leverage this single market," he said. "When we invest in a company in Thailand, for example, we might want to use it as a platform to enter Laos, Cambodia and perhaps now Myanmar."

MVision acted as placement agent for KV Asia Capital Fund I.

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• Southeast Asia
• KV Asia
• Fundraising
• Southeast Asia