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DealStreetAsia

KKR raises record $11bn for world's largest pan-Asia fund

US investment giant seeks eventual expansion to $12.5bn

The $11 billion raised by KKR for its fourth Asia-focused buyout fund surpassed the record $10.6 billion by Hillhouse Capital Group for the region in 2018.   © Reuters

CEBU, Philippines -- U.S.-based private equity giant KKR & Co. has raised approximately $11 billion for its fourth Asia-focused buyout fund, making it the largest pan-Asian private equity fund in the world.

During the company's earnings call Tuesday, KKR's chief financial officer Robert Lewin said KKR Asia Fund IV is already 20% larger than its predecessor, which closed at $9.3 billion in 2017.

KKR is seeking to raise $12.5 billion for its fourth Asia-focused buyout fund and the latest figure brings it to nearly 90% of its target. The $11 billion raised so far through July means that it has already surpassed the record $10.6 billion raised by Hillhouse Capital Group for Asia in 2018.

The KKR fund recently secured a $300 million capital commitment from the New York State Common Retirement Fund. It earlier received commitments from Asian limited partners such as life insurance companies Fubon and Cathay and bagged a $150 million investment from the Minnesota State Board of Investment in February.

KKR's third Asia fund is still actively deploying capital and has recently pumped hundreds of millions of US dollars into businesses such as India's Jio Platforms and JB Chemicals & Pharmaceuticals, Philippine power company First Gen and Vietnam-based property company Vinhomes.

"Between the continued economic growth in Asia, secular tailwinds for the alternative space in the region, and our differentiated track record as well as best-in-class local team, we really believe our Asia business can be as big as our North America franchise in the coming years," Lewin said.

For the entire second quarter of this year, the publicly-listed buyout major raised more than $16 billion, with the Asia private equity strategy taking up the largest component of the capital raised. The rest of the amount was raised through the company's first-time funds and adjacent strategies.

Its Asia infrastructure fund is also already at $2.5 billion, or about 83% of its $3 billion target.

"We've spoken frequently about the significant growth opportunities we have ahead, maybe our biggest is in Asia. Over the past 15 years, we've created the leading private equity franchise in the region," Lewin added. 

KKR's Asia portfolio accounted for 30% of its private equity business, the company said in the latest earnings call. Its assets under management increased 7.1% from the prior quarter to $221.8 billion.

For the original story from DealStreetAsia, click here.

DealStreetAsia is a financial news site based in Singapore that focuses on private equity, venture capital and corporate investment activity in Asia, especially Southeast Asia, India and Greater China. Nikkei owns a majority stake in the company.

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