TPG closes $19.8bn global buyout fund(2)

TPG looks set to clinch the fundraising record of 2008, having closed three funds totalling roughly $30 billion (€21 billion).

TPG Partners VI, the private equity firm’s sixth global buyout fund, has rounded up some $19.8 billion in commitments, PEO has learned from market sources. Its size makes it the third-largest buyout fund ever raised, behind those closed last year by The Blackstone Group and Goldman Sachs.

The TPG fund had been targeting between $18 billion and $20 billion and attracted large commitments from a host of heavy-hitting institutional investors. The New York State Common Retirement Fund approved a $300 million commitment to the fund; The California Public Employees’ Retirement System committed nearly $1 billion; the Pennsylvania State Employees’ Retirement System earmarked up to $400 million; and China’s State Administration of Foreign Exchange reportedly committed $2.5 billion.

Managed by firm co-founders David Bonderman and James Coulter, TPG VI will look to invest $250 million to $1 billion of equity in companies with market values exceeding $300 million, according to documents on the Pennsylvania pension’s website. The pension’s dossier on the fund notes TPG “expects an increase in stressed and distressed seller situations, corporate restructurings and reogranisations, carve-out transactions and structured equity refinancings”.

TPG has also held a final close for its Asian buyout fund on roughly $4 billion, as well as its distressed credit/financial services fund on approximately $6 billion.

South Korea’s National Pension Service agreed to commit $300 million to the firm’s credit fund, which was thought to be targeting $7 billion for investing in troubled financial companies, mainly in North America and Europe.

A TPG spokesman declined to comment.

The $30 billion figure puts TPG ahead of rivals Blackstone and Kohlberg Kravis Roberts in terms of private equity fundraising totals for the year.

This year, KKR closed its most recent buyout fund on $17.6 billion and held a €4.8 billion second close on its €6 billion Europe fund. Blackstone’s credit affiliate, GSO Capital, closed a $2 billion mezzanine fund earlier this year, while the firm’s core private equity franchise is targeting $20 billion for Blackstone Capital Partners VI, as well as $2.5 billion for a distressed investment fund.