Bain Capital raises $7.1 bln in largest pan-Asia PE fund this year (updated)

Toshiba

21/11/2023 02:09

(Adds comments, details and background in paragraphs 8-20)
    By Kane Wu
       HONG KONG, Nov 21 (Reuters) - Bain Capital has completed
the final close of its fifth pan-Asia private equity fund at
$7.1 billion, exceeding its target by 40%, the U.S. investment
firm told Reuters, amid a challenging macroeconomic and
geopolitical environment that has otherwise impeded fundraising
worldwide.
    Bain Capital said the firm itself committed $750 million to
Bain Capital Asia Fund V, alongside existing and new investors. 
    At $7.1 billion, the fund is Bain Capital's biggest to date
for Asia and also the region's largest private equity fund
raised this year, according to Preqin data.
    Bain Capital's fundraising close comes as global investors
confront geopolitical uncertainties, a higher interest
environment, market volatility and macroeconomic headwinds in
many markets.
    "If you've got the right track record, a consistent
commitment across the region, and the right platform, there is
demand, because a lot of investors are under penetrated in
Asia," David Gross, Bain Capital's Asia managing partner, said
late on Monday.
    Asia-focused fundraising totalled $73 billion so far this
year, nearly half of 2022's annual amount and less than a third
of the $299 billion raised in 2021, Preqin data shows. 
    Bain Capital, which started fundraising in the second half
of 2022, had an initial target of $5 billion.
    Japan is an area of focus for the latest fund, Gross said.
    Bain Capital has led 26 investments in Japanese businesses
totalling more than $6.7 billion, including marquee deals such
as the $18 billion buyout of Toshiba Corp's  6502.T  memory chip
business.
    The investment firm is also still active in China, he said,
where investors have been cautious about deploying capital due
to an economic slowdown, regulatory crackdown and Sino-U.S.
tensions.
    Apart from geopolitical tensions, China's economic growth
has been slower than expected with some real structural issues,
Gross said. However, there are areas he sees tremendous growth
in such as data centres and renewable energy and segments that
are more insulated from geopolitical and political factors.
    "We think there are compelling opportunities to invest (in
China), as long as you're thoughtful about sector exposure,
you're thoughtful about the thesis, and how you navigate around
an increasing set of challenges," Gross said.
    No China-focused buyout fund denominated in U.S. dollars has
been raised this year, Preqin data showed.
        Bain Capital invests across multiple asset classes,
including credit, public equity, venture capital and real
estate, managing approximately $180 billion in total assets
globally.
        Gross said he sees investment opportunities in service
businesses for healthcare, information and entertainment
sectors, software companies and consumer sectors especially in
Japan and India.
    Business succession trends across Asia, restructuring of
large regional corporates and multinational companies exiting
China and other Asian markets are also deal drivers in the near
term, he said.
    Bain Capital in August won a bid to take private data centre
provider Chindata Group  CD.O , which it already controls, in a
$3.16 billion deal.
    In the same month, it struck a deal to acquire Australian
aged care operator Estia Health  EHE.AX  A$838 million ($551.3
million).
    Bain in June sold 50% of its Japanese human-resources
software provider Works Human Intelligence to Singaporean
sovereign wealth fund GIC  GIC.UL  for an undisclosed amount.
    The firm closed its previous Asia private equity fund at
$4.65 billion in December 2018.

 (Reporting by Kane Wu; Editing by Jacqueline Wong)
 ((kane.wu@thomsonreuters.com; +85228436590; Reuters Messaging:
kane.wu.thomsonreuters.com@reuters.net))