TPG’s Sixth Pan-Asian Fund To Reach Second Close Of $2B

TPG Capital is reaching a US$2 billion second close for its sixth pan-Asian fund soon, according to media reports.

The US$57 billion-under-management TPG is planning a final close of the fund at US$3.5 billion in the fourth quarter of the year. The firm has originally hoped to raise US$4 billion. In 2008, the Fort Worth, Texas-based firm raised a US$4.25 billion fifth Asian fund.

TPG’s action to reduce its fund size highlights the challenges GPs (general partners) face when raising new funds, even for established big names like TPG. Challenging exit environment is making it tough for private equity firms to return capital to LPs (limited partners), who are in turn delaying making new commitment (Read here for how fundraising environment will be this year).

TPG suffered losses of some of its key managers in Asia during the past few years. In 2010, senior partner Shan Weijian left TPG to join Hong Kong-based PAG. A year later, managing director Mary Ma departed to set up Boyu Capital.

Other private equity firms reducing their ambitious fundraising targets include RRJ Capital, a China and Southeast Asia-focused private equity firm led by two star managers, Richard Ong and Charles Ong. RRJ Capital completed a US$3.5 billion second fund in February, US$1.5 billion less than its US$5 billion original target.

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