Hillhouse Investment, the private equity firm best known for betting on China’s up-and-coming startups, is in the market to raise $7-8 billion for a new buyout fund, MergerMarket has reported.
The fundraising process reportedly started in January, and Hillhouse is said to have pledged to make a GP commitment of $1 billion.
The planned GP commitment represents up to 14.2% of the fund size, a figure significantly higher than the global average of around 3% for private equity funds, based on Investec’s 2024 Private Equity Trends Report.
The new fund signals Hillhouse’s continued shift towards global buyout opportunities, leveraging its Asian heritage while diversifying geographically.
It also comes as investor appetite for Southeast Asia-focused PE funds has notably waned in 2024. According to DealStreetAsia’s Private Equity in SE Asia: H1 2024 Review, no Southeast Asia-focused PE fund secured a final close in the January-June 2024 period.
On a more positive note, there was a steady flow of new funds entering the market last year, with at least seven new funds targeting majority allocations for Southeast Asia.
Founded in 2005, Hillhouse is an alternative investment firm headquartered in Singapore with a staff of over 500 globally in over 18 countries, according to its website. Besides Singapore, it also has offices including in New York, London, and Hong Kong, among others.
The firm’s portfolio in Southeast Asia includes Singapore-based semiconductor startup Silicon Box; super app Grab; B2B marketplace Udaan; and voice AI startup WIZ.AI.
Its prominent portfolio companies include Airbnb, Uber, Traveloka, Didi, JD.com, Tencent, Meituan, NIO, Beijing-based global biotechnology firm Beigene, Chinese women’s shoe retailer Belle International, among others.
In September last year, Hillhouse was reported to be in talks with Singapore’s wealth fund GIC and state investor Temasek to invest in appliance maker Midea’s Hong Kong initial public offering.
The PE firm last year also acquired Singapore-headquartered corporate solutions and business advisory firm Incorp Global from TA Associates.
In December, Hillhouse Investment appointed Tomohiro Kikuta, a former partner at Bain Capital, to spearhead its expansion efforts in Japan amid a significant rise in deal-making activities.
