Bain’s Big Day

The fax machines are humming today at Bain Capital, as investors submit commitments for the firm’s tenth buyout fund. Bain began raising the fund earlier this year with a $10 billion target, and is expected to have in excess of $7 billion once everything is counted over the weekend. A final close will occur early next year, as certain LPs have already burned through their 2007 allocations.

Bain also is raising a $5 billion co-investment fund, with a first close on that vehicle expected to occur in a few weeks.

So what does this tell us? Limited partners are all talk when it comes to souring on mega-buyouts. They complain a good game with reporters, but sign up when offered the opportunity. Bain was able to keep its hefty 30% carried interest intact, plus the industry-standard broken deal fees that have sparked concerns in the wake of Sallie Mae.

Bain began marketing this fund before the credit crunch, but never was forced to cut back on its aspirations. It is even said to be playing tough with some smaller limited partners, who would prefer to commit less than what Bain set as a minimum.

Maybe certain LPs are just hoping that this giant stash will prevent Bain from returning to market next year. The Boston-based firm closed its $10 billion ninth fund ($8b general/$2b co-invest) just 18 months ago, and its $5 billion eighth fund ($3.5b/$1.5b) less than two years before that.

“Every time Bain fundraises, it says that it expects the capital to last three to four years,” says one LP. “But then it’s gone in 24 months. I like the regular accountability, but wouldn’t mind being left alone a bit longer next time.”

LBO Wire first reported news of today’s first close for Fund X. Bain is likely to use Fund IX capital for its Clear Channel acquisition, while tapping Fund X for 3Com.