US/EUROPE- Private equity firm Warburg Pincus has announced that its WP VIII fund has closed with assets of $5.3bn (€5.9bn), a figure it claims is a “considerable accomplishment” in light of the volatile economic climate and consolidating private equity market.
This is the tenth fund closing since the firm started out 30 years ago and combined with the company’s $2.5bn international fund, Warburg Pincus has some $8bn to invest. “The closing of the fund allows us to focus on investing in companies at all stages of development – from venture capital start-ups to buyouts,” says Lionel Pincus, the company’s chairman and chief executive.
John Barber, a director at London-based European private equity placement agents Helix Associates, says” “this is indeed a tremendous achievement when you consider the downward turn in the PE market recently.”
The news comes after European buyout specialist firm, Cinven, recently announced that its third fund had closed with assets of €4.3bn, which was significantly above its original target of €3.5bn.
But Barber stops short of saying these positive closings are signs of a turnaround in fortunes. “I am not sure it is fair to say these results are indicative of a change of trend in the private equity market but do prove that there is still vitality in it. Investors are more discriminating these days,” he says.
“Several of the top ten US private equity companies have had to revise their fund closing expectations. Some are still closing funds with considerable amounts of money, but nothing like their original targets,” he says.