Bain set to close third Asia fund at $3 bln hard cap: Updated

  • Fund III to close on $3 bln hard cap
  • Fundraising launched in May
  • Bain gave LPs carry/fee options

Bain Capital, which sees Asia as a “dynamic and attractive” region for investing, is preparing to close its third Asia fund at its $3 billion hard cap, according to a limited partner with knowledge of the fund.

Update: Bain announced in early December, after our original story published, that it did indeed close Bain Capital Asia Fund III LP on $3 billion.

Fundraising is essentially finished pending some last-minute investor sign-offs, the LP said.

Bain Capital launched fundraising for Bain Capital Asia Fund III LP in May. The GP planned on kicking in a minimum $250 million commitment to the fund, or 10 percent of the $2.5 billion target. It is not clear if the GP is increasing its commitment to remain at 10 percent of the fund.

Bain Capital is not offering any fee breaks on the fund, according to a person with knowledge of the fundraising. The firm offered the option of either charging a 2 percent management fee and 20 percent rate of carried interest subject to a hurdle, or a 1 percent management fee and a 30 percent carry rate with no hurdle, according to the LP.

Bain Asia III is earmarked for investments in China, Japan, India and Australia, but it has flexibility to invest in other parts of Asia-Pacific, according to a fundraising document. Bain Capital has an Asia team of more than 60 investment professionals, the document said.

“We continue to believe Asia is a dynamic and attractive region for our own capital, and an important strategic focus for our firm,” the document said.

Bain Capital raised $2.3 billion for its second Asia fund in 2012, with about $300 million of that coming from the GP, Reuters news service reported at the time. The firm raised about $1 billion for its debut Asia fund in 2007.

Fund II was generating a net internal rate of return of 18.4 percent as of March 31, 2015, according to performance data from backer California State Teachers’ Retirement System. Fund I was producing an 8.08 percent net IRR as of the same date.

Action Item: Check out an investment report on Bain Capital Asia Fund III.

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