Morgan Stanley Private Equity Asia, the Asian private equity arm of the U.S. bank, has raised around US$1.7 billion for its fourth Asia-focused fund, ahead of its original target of US$1.5 billion, according to a company announcement.
The fundraising process began in mid-2012, and reached a first close of US$750 million that year.
The new fund has a similar mandate to MSPEA’s third fund, aiming to invest in public and private medium-sized enterprises in the consumer, financial services, and industrial products sectors.
"One of the key focus areas for Fund IV will be China. We continue to believe that China represents one of the world’s most attractive investment destinations," says Homer Sun, chief investment officer of MSPEA. "In addition, we have been active in Korea, particularly in the buyout space."
Oregon Investment Council, Public School Employees’ Retirement System (PSERS) in Pennsylvania, University of Michigan Pension Fund are disclosed to be the limited partners (LPs) of the fund.
MEPEA is currently in the process of finalizing a number of go-private deals of overseas-listed Chinese companies, including New York Stock Exchange-listed education provider Noah Education Holdings Ltd, Chinese natural gas distributor Sino Gas International Holdings Inc., and Beijing-based Chinese fertilizer producer Yongye International, Inc.
This April, MSPEA was reported to partially exit Hong Kong-listed Sihuan Pharmaceutical Holdings Group Ltd. by selling 120 million shares for a total proceeds of US$147 million.
In addition, MSPEA-backed Chinese special chemicals firm Tianhe Chemicals Group Ltd. has completed a US$654 million Hong Kong IPO, but it is unclear if or how many shares MSPEA sold during the IPO.
MSPEA has invested approximately US$2.5 billion in Asia, primarily in highly structured minority deals and control buyout transactions.