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Market at a glance: PE fundraising slows further with early impact of covid-19

226 US-based buyout, growth equity, mezzanine and other PE funds secured a total of $54.5 billion, down 26 percent from the $74 billion raised at the same time last year.

US private equity fundraising showed further signs of weakness at the close of the first quarter, according to Buyouts data, indicating the early influence of the coronavirus pandemic.

As of April 1, 226 US-based buyout, growth equity, mezzanine and other PE funds secured a total of $54.5 billion, down 26 percent from the $74 billion raised at the same time last year.

These data point to a growing disparity between trend lines this year and in 2019. At the beginning of March, fundraising totaled $41.2 billion, down 19 percent from a year earlier.

Vehicles which added to fundraising totals in March include Bregal Sagemount’s third growth-focused PE fund, which closed at $1.5 billion; Rubicon Technology Partners’ third enterprise software fund, which brought in more than $1.26 billion; and BV Investment Partners’ tenth business services and IT fund, which closed at $1.1 billion.

US PE fundraising totaled $310 billion in all of 2019, Buyouts data show, up 26 percent from 2018 and the highest level reached since 2007.

Noteworthy fund stories recently covered by Buyouts

Riverside-spinout Align Capital closes sophomore fund at $450m hard cap

Align Capital Partners, founded by former Riverside Co executives, wrapped up its second lower midmarket vehicle, raising $450 million. The fund closed at its hard cap, surpassing a $400 million target after little more than three months of marketing.

Ares targets $2bn for revamped direct lending fund

Ares Management is back to market with a new debt fund, Ares Pathfinder, targeting $2 billion with no hard-cap. The vehicle is a re-branded and reworked strategy that will consider a broader menu of possible assets to use as collateral for loans.

Birch Hill Equity Partners secures C$1.7bn in final close of Fund VI

Birch Hill Equity Partners collected more than C$1.7 billion ($1.3 billion) in the final close of a sixth mid-market pool. The firm obtained 35 percent more capital for the latest fund compared with its predecessor, which was completed in 2015 at C$1.3 billion.

LPs in Blackstone’s record-breaking flagship fund have a fee holiday

Blackstone Group raised the largest private equity fund ever in 2019, closing its eighth flagship pool at $26 billion. When the fund activates in the next few quarters, investors will get a break from fees for a four-month period, easing the J-curve effect.

Castanea Partners, once-hyped consumer investor, loses senior executives

The future of Castanea Partners, which made headlines with its 2009 investment in cosmetics brand Urban Decay, is uncertain after executives, including a managing partner, left last year. Castanea closed its most recent fund in 2014 at $600 million.

Credit Suisse fundraising veterans launch placement agency

A new player has entered the PE fundraising game: Aviditi Advisors. The placement agency, backed by a family office, was formed by Ryan Schlitt and John Robertshaw, both exCredit Suisse fundraisers.

Dyal Capital considers sale of GP stakes out of third fund

Dyal Capital Partners is exploring options for its third GP stakes fund, which could include selling a strip of investments from the pool. It is not clear what sort of structure such a deal could follow. Fund III was closed in 2017 at $5.3 billion.

EagleTree’s Fund V closes at $1.1bn with help of AlpInvest, other investors

EagleTree Capital closed a fifth flagship buyout vehicle, collecting more than $1.1 billion. Fundraising got a leg up early this year when the firm was backed by AlpInvest Partners, Alberta Teachers’ Retirement Fund Board, Misland Capital and Bullingham Capital.

EIV closes in on $750m goal for fourth midstream energy fund

EIV Capital raised more than $640 million toward an overall target of up to $750 million for its fourth midstream energy fund and a sidecar pool. EIV set a $525 million target and $600 million hard cap for Fund IV, with the sidecar offering $150 million.

GI Partners nears target, eyes cap on debut digital infrastructure fund

GI Partners collected about $1.2 billion for its debut digital infrastructure fund that will invest in assets like data centers. The firm, which last year hired Alinda Capital’s Mark Prybutok for the strategy, is targeting $1.25 billion with a $1.5 billion hard-cap.

HIG Capital spinout part of 2020’s new crop of emerging managers

This year’s fundraising season is only a few weeks old but has already seen offerings from new shops launched by veteran investors. They include the inaugural pool of American Pacific Group, founded in 2019 by Fraser Preston, a former HIG Capital executive.

Secondary firm Newbury Partners runs secondary on debut fund

Newbury Partners is allowing investors to sell their stakes in the firm’s first secondary fund, closed in 2008 at $702 million. The process does not include a shot of fresh capital invested into a new pool. Newbury is seeking up to $2 billion for Fund V.

Silver Lake, with new leadership slate, could raise $18bn for next flagship fund

The next mega-fund is heading to market soon, as Silver Lake Partners prepares to launch its sixth flagship tech vehicle. Silver Lake, which recently appointed new co-CEOs, could target about $15 billion for the fund and raise as much as $18 billion to $20 billion.

Thoma Bravo targets $14bn for 14th flagship amid fundraising blitz

The tech fundraising arms race is in full swing, with Thoma Bravo seeking $14 billion for its fourteenth flagship pool. The firm is at the same time targeting $3 billion for its third mid-market-focused Discover Fund and $1 billion for its small-cap fund Explore.