It appears that mega-funds are the hot private equity investing topic of 2021.
This year is looking to be a banner one for private equity’s mega-funds, with the likes of Hellman & Friedman closing its 10th namesake fund at $24.4 billion and The Carlyle Group reportedly eyeing $27 billion for its next flagship vehicle—in what would be the largest private equity vehicle of all time.
In all, 12 buyout and growth mega-funds—defined as any fund that has raised over $5 billion—have already closed this year. For context, 18 mega-funds were closed in 2019, and 16 in 2020.
According to PitchBook data and Pitchbook’s Q2 2021 US PE Breakdown, at least seven of those 12 funds have raised over $10 billion each.
Separately, two funds—spearheaded by KKR and Carlyle—have targeted or raised over $10 billion, but not closed.
“Strong public market performance drives increased PE commitments due to the ‘denominator effect,’ since LPs try to maintain alternatives allocations at a set ratio to public equities allocations. LPs often prefer to re-up with managers with whom they already have a relationship, since this requires less due diligence,” Springer said.
A look at the top 10 mega-funds of 2021 that have closed or are expected to close:
Carlyle Fund XI – $27B (Target amount (not yet open))
Hellman & Friedman Capital Partners X – $24.4B (Closed)
Silver Lake Partners VI – $20B (Closed)
KKR North America Fund XIII – $18.5B (Open (current size fund)
CD&R Fund XI – $16B (Closed)
KKR Asia Fund IV – $14.7B (Closed)
TA Associates XIV – $12.5B (Closed)
Bain Capital Fund XIII – $11.8B (closed)
Genstar Capital Partners X – $11.7B (closed)
Ardian LBO Fund VII – $8.9B (closed)
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