Actis Seeks $3.5 Billion for Fund 4

Actis Capital, a private equity firm that invests in emerging markets, has begun raising its newest fund, Actis Emerging Markets 4, which Preqin, a private equity data firm, reports as having a $3.5 billion target. Among the new fund’s investors is the Pennsylvania School Employees’ Retirement System, which recently committed $100 million. PennSERS had also committed $200 million to the firm’s previous fund, Actis Emerging Markets 3.

In what has turned out to be a difficult fundraising environment, when many firms are launching funds with smaller targets than in previous years, Actis’s $3.5 billion goal is a bold bet that its popular focus on emerging markets will draw in more money. Actis’s previous emerging markets fund closed in 2008 having raised $2.9 billion, nearly $400 million above its original target.

The London-based firm concentrates on investing in five emerging-market areas: Africa, China, India, Latin America and Southeast Asia. The firm typically seeks investments about $50 million in size. Popular industries include healthcare, restaurants and consumer services.

Recent investments have included Tracker, a South African vehicle tracking technology firm; Gtex, a Brazilian cleaning products company; and Paras Pharmaceuticals, an Indian medical company.

In 2009, Buyouts reported that more than one-third of the money in Fund 3 came from North American institutional investors. Besides PennSERS, other Fund 3 investors include the San Francisco Employees’ Retirement System.

Actis, which was initially part of CDC Group, an emerging markets investment company supported by the British government, was spun out in 2004. It has regional offices in Beijing, Cairo, Delhi, Johannesburg, Lagos, Mumbai, Nairobi, Sao Paulo and Singapore.

A spokesman for Actis declined to comment on the firm’s fundraising efforts.