Bain raises $2.3 billion for second Asia fund

Bain Capital Asia Fund II kicked off its fundraising last June, and reportedly counts some of the largest US public pension funds as LPs. Pennsylvania Public School Employees' Retirement System (PSERS) has reportedly committed $100 million, while Los Angeles Fire and Police Pension System put in $10 million.

The private equity firm, which was co-founded by Republican presidential candidate Mitt Romney, offers investors differing options on the fees it charges - a concept that was first tested on its second Asia fund. Investors can either choose from paying a 2% management fee with a 20% carried interest and a 7 % hurdle rate, or a 1% management fee and 30% carried interest with a 10% hurdle rate.

The vehicle is double the size of its predecessor, which raised $1 billion in February 2007. According to a report in LBO Wire, Bain's first Asia fund generated a 1.6x multiple of capital and internal rate of return of 24.8% as of June 2011.

Bain has invested a total of $4.4 billion so far in the Asia.

Japan is expected to remain as a key focus in Bain's investments. In June, the firm agreed to buy a 50% stake in Jupiter Shop Channel (JSC), a television shopping company, from Japan-based Sumitomo Corporation. Industry sources noted that the deal is worth JPY100 billion ($1.3 billion), which might be Japan's largest private equity transaction of the year.

Several other pan-regional funds are also already in the market or planning to launch. Last month, KKR reached the halfway point in fundraising for its second Asia fund, receiving more than $3 billion in commitments. Third-party investors have pledged $2.76 billion to KKR Asian Fund II, with the GP putting in a further $250 million.

In April, TPG Capital was also reportedly nearing a first close of $1.5 billion on its latest vehicle, which has a target of at least $4 billion. Government of Singapore Investment Corp. (GIC) is expected to be the largest investor.

The Carlyle Group is said to have made initial approaches to investors regarding its $3.5 billion fourth Asia buyout fund, while PAG last year reached a first close of $1.7 billion on its $2.7 billion debut vehicle.

Of those yet to launch officially, Morgan Stanley Private Equity Asia is expected to seek about $1.5 billion, the same as for its previous fund. Affinity Equity Partners is only in the initial stages of preparation, but raised $2.8 billion for its third fund in 2007.

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• Topics
• Fundraising
• Bain Capital Asia
• KKR
• TPG Capital
• The Carlyle Group
• PAG
• Fundraising
• Morgan Stanley Private Equity Asia