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Bank of America Asian PE spinout NewQuest nets $215m for Fund II first close

19 Dec 2013

dollar moneyThe direct secondaries firm formed by the spin out of Bank of America Merrill Lynch’s Asian private equity assets two years ago has hit a $215m first close for its first independently-raised vehicle.

That close means NewQuest Capital Partners is well on the way to its $300m target for the vehicle, and could go as high as its $330m hard cap.

The firm hopes to hold a second close in the first quarter of next year ahead of completing the fundraise in the summer, AltAssets has learned.

NewQuest has been reticent about the size of its first fund created from the BAML spin-out, but reports at the time put it at about $400m.

Paul Capital, HarbourVest Partners, LGT Capital Partners and Axiom Asia were limited partners in that fund, which focused primarily on secondary positions in companies based in China and India.

Axiom and Paul Capital have declined to re-up for the second vehicle but have been replaced by two other LPs in the first close, a source said.

NewQuest managing partner Darren Massara was previously managing director of BAML’s private equity group based in Hong Kong, and before that spent more than eight years at the World Bank’s investment arm IFC.

NewQuest has tapped its debut vehicle for a string of deals across Asia, including several in Japan, Singapore and Taiwan.

It declines to name any of its portfolio companies on its website, but states the business areas cover clean energy, telecom, media and technology, financial services, healthcare, consumer and logistics.

Their Indian investments to date include a multi-modal logistics company, embedded software and systems design business and manufacturer of complex fertilizers.

A total of six Chinese companies have received backing from NewQuest to date, including a small hydro power consolidator, the country’s largest independent healthcare management company and an independent cement manufacturer.

In the summer direct secondaries-focused private equity firm W Capital Partners closed its third fund on its $750m hard cap, six months after it had hoped to reach the total.

AltAssets revealed in December 2012 that the firm was eyeing a January final close for the fund, which had already held a $518m interim close by that point according to a source with knowledge of the fundraise.

But despite taking longer than hoped the firm reached its target, just beating the $700m it collected for its last direct secondaries fund in 2008, and triple the $250m it gathered for its debut 2004 vehicle.

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