Blackstone seeks to raise at least $10 billion in new Asia PE fund, sources say

10:36 am Thursday, October 03rd, 2024

By Kane Wu and Yantoultra Ngui

HONG KONG/SINGAPORE (Reuters) -Blackstone Inc, the world’s largest alternative asset manager, has started raising its third Asia-focused private equity (PE) fund, targeting at least $10 billion, two people with knowledge of the situation said.

The new buyout fund, Blackstone’s third in Asia, will primarily focus on India with the largest percentage of capital allocated there, the sources said, declining to be named as they were not authorised to speak to the media.

China will not be a focus market for the new fund, the sources said.

Japan and Australia will be two other significant markets for Blackstone while it continues to look at other countries such as South Korea and Singapore, they said.

The capital allocations of Blackstone’s new Asia PE fund would not be set in stone, however, and strategy could shift based on the macroeconomic environment, one of the sources said.

Blackstone declined to comment.

The fundraising comes as global and regional investors seek new growth in Asia as investing in China has become challenging in recent years due to an economic slowdown, a regulatory crackdown and Sino-U.S. tensions.

Private equity-backed deals in mainland China totalled $27 billion in the first three quarters, down 9.5% year-on-year to be overtaken by Australia as the biggest market in Asia, LSEG data showed.

China-focused private equity fundraising also dropped to the lowest in at least 10 years, totalling $11 billion as of Sept. 26, according to industry data provider Preqin.

Investor sentiment on China has, however, turned recently with inflows leading to a rebound in Chinese stocks after the government announced a broad stimulus package including interest rate cuts and a $114 billion war chest to boost markets.

Blackstone said last year it was bullish on India due to its faster growth than other large countries.

It also planned to double headcount in Singapore in an expansion into Southesat Asia, its Asia PE head told Reuters in January.

New York-based Blackstone, which manages over $1 trillion in assets including real estate, closed its second Asia buyout fund at $11 billion in 2022.

It announced a deal in September to buy Australian data centre group AirTrunk for an implied enterprise value of over A$24 billion ($16.10 billion), in what would be Blackstone’s largest investment in the Asia Pacific region.

(Reporting by Kane Wu in Hong Kong and Yantoultra Ngui in Singapore; Editing by Mark Potter and Emelia Sithole-Matarise)