TPG Capital’s PE peers outpace in fundraising, UNITE HERE reports

TPG Partners VII has been slow to attract commitments

SAN FRANCISCO--()--TPG Capital used to dominate buyout fundraising. But TPG has slipped, and its struggle to reach the target for its latest flagship fund may not bode well for the firm’s future plans for growth, a new report by UNITE HERE says.

“TPG, A Slipping Giant” report available at pecloserlook.org.

In 2014, TPG dropped to 5th place in the PEI 300 list of private equity fundraising.i TPG previously held the top slot in 2011, 2012 and 2013.ii

TPG Partners VII has lingered in market without meeting its target, which was reduced to $8 billioniii from $10 billion.iv

TPG Partners VII’s pace of fundraising has lagged peers like Apollo and Blackstone. TPG’s seventh fund has so far drawn $7.25 billion,v an average of $660 million per month in commitments over the past year of fundraising, and remains open.

By comparison, Apollo Investment Fund VII attracted an average of $2.6 billion per month to reach $18.5 billion over seven months.vi Blackstone Capital Partners VII brought in an average of $1.9 billion per month, meeting its $17 billion target in nine months.vii

Questions

  • How does the slow fundraising of TPG Partners VII influence investors’ view of TPG?
  • Are investors confident TPG can overcome the weak performance for funds V and VI?
  • How do TPG Partners VII’s fundraising challenges impact TPG’s plans for an IPO?
  • If TPG opts to enter the public markets, how will TPG executives split their focus between unwinding legacy funds, deploying new funds and preparing for an IPO?

i https://www.privateequityinternational.com/uploadedFiles/Private_Equity_International/PEI/Non-Pagebuilder/Aliased/News_And_Analysis/2014/May/News/PEI%20300%202014.pdf

ii http://gvcepe.com/site/wp-content/uploads/2012/07/PEI_300.pdf and https://www.privateequityinternational.com/uploadedFiles/Private_Equity_International/Data/Quarterly_Reports/PE%20Q2%20report%202013.pdf

iii CalSTRS, PE semi-annual performance as of March 31, 2015

iv Fortune, “TPG Capital nears first close on giant new fund,” Dec. 18, 2014

v PE Hub, “TPG reaches $6.5 bln for Fund VII’s first close,” March 2, 2015 and Pensions & Investments, Q2 2015 searches and hires overview report, July 16, 2015

vi Apollo Investment Fund VIII, SEC Form D, filed Jan 17, 2014

vii Fortune, Blackstone closed $17 billion May 2015 in 9 months, May 8, 2014

Contacts

UNITE HERE Research
Alyssa Giachino, 310-795-5537
agiachino@unitehere.org

Release Summary

TPG Capital used to dominate private equity buyout fundraising. But TPG Partners VII has languished in market, lagging Blackstone and Apollo in attracting commitments from institutional investors.

Contacts

UNITE HERE Research
Alyssa Giachino, 310-795-5537
agiachino@unitehere.org