Global private equity firm, Warburg Pincus has achieved a final close on Warburg Pincus Private Equity VIII at $5.3 billion. This is $3 million over its original target of $5 million set at its launch a year ago. The fund will invest in companies in the US, Europe and Asia and is investing alongside the firm’s $2.5 billion international fund. Combined, the group has some $7.8 billion of capital available for investments, one of the largest pools of capital dedicated exclusively to private equity.
“We believe this is a considerable accomplishment in this market,” said Lionel Pincus, Warburg Pincus chairman and chief executive officer. “The closing of the fund allows us to focus on our proven model of investing in companies at all stages of development from venture capital start-ups to buyouts.”
This is the tenth fund raised over Warburg’s 30-year history. Jeremy Young, a Warburg managing director, based in the firm’s London office, said: “We see a number of sectors poised for tremendous growth and we are pleased that the close of this fund results in combined funds of nearly $8 billion, the largest available pool of private equity capital in the region.”
Drawing on experience of previous funds, Young anticipates that around 30 per cent of the fund will be invested in Europe, although there are no geographic restrictions on the fund. He adds that the fund is looking to invest across the board, but is not so enthusiastic when it comes to the mega deal segment. “At the top end of the scale it’s really tough there is lots of money about, but few deals and the debt market isn’t that good,” he says.
“We have built our businesses by trying to be distinctive and not following the crowd. When everyone was piling money into the Internet bubble, we returned $10 billion to investors. Which is one of the reasons we have been so successful with our fund raising.”
Young is optimistic for the future of the fund: “We have already invested $600 million from the fund. It is a very attractive environment for us at the moment, but for the industry it is still generally a tough time.”
Since 1971, Warburg Pincus has invested around $12.2 billion in 450 companies in 29 countries. The firm currently has around $10 billion under management with an additional $7.5 billion available for investment.