2006: a record fund raising year?

This year looks set to be another record-breaking fund raising year according to recent data from Private Equity Intelligence (PEI). The research reveals 263 new private equity funds have raised US$167bn worldwide so far in 2006. This is an increase of 12% on funds raised in the first half of 2005.

Of this total, 143 new US-based funds have raised US$108bn; 65 new European-based funds have raised US$41bn and 55 funds based in Asia and elsewhere have raised US$18bn.

Buyout funds have continued to gain the highest levels of support this year, but other fund types have also done well. According to PEI, 74 buyout funds have raised US$84bn between them (with over US$44bn from just 7 megafunds of above US$3bn); 87 venture funds have raised US$23bn; 24 real estate funds have raised US$19bn; 26 fund-of-funds have raised US$8bn; 21 mezzanine funds have raised US$12bn; eight infrastructure funds have raised US$5bn and seven distressed debt funds have raised US$3bn.

Investor demand remains strong, with no fewer than 787 new funds still on the road, aiming to raise an unprecedented further US$342bn. Conditions for fund raising have remained strong throughout the year, and Private Equity Intelligence is forecasting that private equity fund raising for 2006 will exceed US$300bn for the first time in its history.