Money poured into private-equity funds at almost the same unprecedented rate as in the first half of 2007, showing that even after the credit crunch big investors still have a huge appetite for alternative assets.
Pension funds and other big institutions are simply shifting their sights from buyout funds, which did show a considerable slowing in the latest fund-raising figures from Private Equity Intelligence, to infrastructure and distressed debt funds.
With stock indexes slumping, the big investors are finding they have no choice but to stay focused on so-called alternative assets as a way to generate returns in otherwise soft markets. According to London-based Private Equity Intelligence, private equity fundraising totals $314-billion (U.S.) for the first six months of the year, neck-and-neck with the $321-billion raised in the first half of 2007, a period of bliss before the crunch came.
Buyout funds, however, raised 21 per cent less than in the prior period.
The biggest of the distressed debt funds raised is Oaktree Capital Management's OCM Opportunities Fund VIIb, which Los Angeles-based Oaktree expects will find a target-rich environment among boom buyouts gone bad.
Private equity money pours in, but shifts targets
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