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Hong Kong's PAG plans up to $6 billion new Asia private equity fund: sources

Reuters  |  HONG KONG 

By Kane Wu

HONG KONG (Reuters) - Hong Kong-based firm PAG is planning a new fund that aims to raise as much as $6 billion, two people with knowledge of the plan said, potentially adding to a massive pool of buyout for acquisitions in the region.

PAG has started sounding out investors about the fund in recent weeks, the two people and others told The firm raised $3.6 billion with its second Asian fund in 2016 and the third fund will be its largest to date.

PAG has not yet formalised the fund size or the fundraising schedule, the people said, adding that the plan is subject to change.

A for PAG said the information is incorrect, without elaborating. He declined to comment further. The people declined to be identified as the fundraising plan was confidential.

A slew of global and regional firms have raised or are raising record-level funds for investments in or cross-border deals.

raised a $9.3 billion Asia-focused fund in 2016, the biggest in the region. Carlyle is reaching close for a planned $5 billion Asian buyout fund, while Blackstone is seeking to garner up to $3 billion in its first pan-buyout fund, reported earlier.

PAG's regional peers such as Hillhouse Capital Group, Baring and are all currently raising for their own funds, people with knowledge of the activities have told

firms are looking to add cash reserves, or so-called dry powder, in the region, as investors worldwide allocate capital to catch growing market and economic momentum in countries from to and

Trade publication AVCJ first reported the PAG fundraising plan earlier on Friday, saying its target was $4.5 billion.

HIGH-PROFILE DEALS

Founded in 2002 by Weijian Shan, a Chinese dealmaker who previously worked at and JPMorgan Chase & Co, PAG now manages more than $20 billion in capital.

The firm has struck a number of high-profile deals in the last two years, including its funding in a $1.6 billion deal by to acquire troubled Japanese Takata Corp.

Last year, it won the bid to acquire control of Hong Kong-listed amid a rare public Chinese boardroom battle.

PAG also controlled Music Corp, a music streaming business which in 2016 merged with the music business of gaming giant to form Music. The business, in which PAG made an initial $60 million investment and still holds a stake, is valued by some investors at $20 billion, told a conference in Hong Kong last year.

PAG's first pan-fund, raised in 2012, achieved a 19.9 percent net internal rate of return by the end of September last year, according to pension fund The firm is currently also raising a China-focused distressed debt fund with a target size of up to $300 million.

Last month, Blackstone announced it had acquired a passive minority stake in PAG, without disclosing the terms of the deal.

(Reporting by Kane Wu; Editing by and Muralikumar Anantharaman)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, April 13 2018. 16:06 IST
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