The Canadian pension fund plans to increase its allocation to the region from 10% to 15% over the coming four years, even as its total assets under management rise.
The closing of Asia Opportunity Fund III, the third buyout fund raised by CCMP Capital Asia since 1999, reflects the growing appetite for private equity investments among investors still heavy with cash and looking for opportunities in this region. For many investors who have been burned by investments in equities, fixed income and hedge funds, the focus is also increasingly turning to private equity.
Andrew Liu, CCMP Capital AsiaÆs managing partner and CEO, notes the timing of the closing of the firmÆs latest fund allows it to capitalise on lower valuations owing to the global financial crisis. Liu credits the firmÆs loyal ôblue-chip investor baseö for raising the fresh capital.
The majority of the investors in Asia Opportunity Fund III are long-time supporters of the firm, such as Goldman Sachs Private Equity Partners Asia, Ohio Public EmployeesÆ Retirement System, Ontario Teachers, Pantheon Ventures, Partners Group, SEB, State of Michigan Retirement System, the State of Oregon and Washington State Investment Board.
Public pension plans and sovereign wealth funds make up 60% of the investor base, while the remaining 40% is comprised of funds of funds, endowments and foundations.
In terms of geography, over 65% of the investors are from North America, 25% from Europe and 10% from the rest of the world.
The fund ôputs us in a strong position to continue to execute our proven investment strategy in what should be an attractive environment for making new investmentsö, says Liu.
For this latest fund, CCMP Capital Asia plans to stick with its investment strategy of acquiring controlling stakes in mid- to large-sized market leading companies in Asia-Pacific, with an emphasis on the consumer, retail, industrial manufacturing and services sectors.
CCMP Capital Asia will be renamed Unitas Capital when its affiliation with CCMP Capital Advisors LLC ends on January 30, 2009.
Having both grown out of J.P. Morgan Partners in 2005, CCMP Capital Asia and CCMP Capital Advisors maintained an association while operating and fundraising independently in their respective regions for the past three years.
The decision to finally separate formalises what has been a natural evolution of their respective businesses. CCMP Capital Advisors has invested approximately $12 billion in buyout and growth equity transactions since 1984. The firm's five targeted industries are: consumer, retail and services; energy; healthcare infrastructure; industrials; and media and telecom.
Business at Unitas Capital will carry on as usual, with Liu holding on to his post as managing partner and CEO.
ôUnitas Capital is looking forward to taking advantage of the many investment opportunities coming up in the Asian market,ö Liu says.
CCMP Capital Asia is one of the largest dedicated regional private equity firms in Asia, with $4 billion in capital commitments under management. Originally founded in 1999, Liu notes that the firmÆs team has been working together for nearly a decade and has deep-rooted local connections throughout the region, including Australia, Greater China, Korea, Japan and Singapore.
Specialising in the consumer, retail, industrial manufacturing and services sectors, the firm has led some of the largest and most successful leveraged buyouts in Asia, including: Mando Corporation, Haitai Confectionery and Buy The Way in Korea; Yellow Pages in Singapore; Rhythm Corporation in Japan; and Waco and Repco in Australia.
They have teamed up with each other and with overseas investors to boost investment capacity in real estate and infrastructure investments in Europe and North America.
Asset owners across Asia Pacific weathered some difficult market conditions in 2020. While most emerged from the year successfully, some notable exceptions suffered asset drops.
Thanks to the current rise in yields, the key return driver of the bond market is set to change but its bull run will very likely continue.
Asian institutional investors were generally more optimistic about post-pandemic economic recovery but only 33% were confident about achieving their short-term objectives.