UPDATE 2-Warburg Pincus raises $11.2 bln private equity fund

Fri May 10, 2013 1:51pm EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Greg Roumeliotis and Soyoung Kim

NEW YORK May 10 (Reuters) - Warburg Pincus LLC has secured $11.2 billion for its latest global fund, one of the largest private equity funds raised since the financial crisis, underscoring investor demand for high-return offerings at a time of record-low interest rates.

Private equity firms moderated their fundraising expectations following the crisis, launching funds that in general were smaller than their predecessors. Warburg's previous fund, which had a $12 billion fundraising target, ended up raising $15 billion in 2007.

Warburg's latest fund also had a $12 billion target. While it fell short of that, it is still larger than other mega private equity funds raised in the last six months, including Silver Lake LP's $10.3 billion fund and Advent International Corp's 8.5 billion euro ($11.1 billion) fund.

Last year, Blackstone Group LP raised the largest private equity fund since the financial crisis, amassing $16 billion after four years of fundraising. It also raised a $13.3 billion private real estate fund.

For most private equity funds, fundraising remains challenging due to fierce competition. In the first quarter, 129 private equity funds reached a final fundraising close like Warburg, raising a total of $67 billion, compared with 203 funds that raised $79 billion in the first quarter of 2012, according to market research firm Preqin.

Sentiment, however, appears to be improving as institutional investors, particularly pension funds with huge liabilities, look for outsized returns that exceed the broader market. Carlyle Group LP co-founder David Rubenstein said on Thursday that the firm could exceed its $10 billion fundraising target for its latest flagship U.S. buyout fund.

New York-based Warburg Pincus said on Friday that investors in the new fund, Warburg Pincus Private Equity XI, include public and private pension funds, sovereign wealth funds and wealthy individuals, with a significant number of the new investors coming from outside the United States.   Continued...