Blackstone plans up to record US$30b for flagship buyout fund

New York

BLACKSTONE Inc is preparing to raise what could be the industry's largest buyout fund on record. The firm may seek as much as US$30 billion for its next flagship private equity fund, according to people familiar with the matter.

No target has been set but fund-raising could begin next year, said the sources.

It's a frenzied time for private equity. Blackstone and peers are ramping up fund sizes and coming back to market with successor pools at a rapid clip. Almost 6,000 funds are currently seeking to rake in a record US$1 trillion, according to data from Preqin.

Blackstone, which managed US$684 billion at the end of June, is also preparing to raise money for its next life sciences, energy and growth strategies, said the sources, noting that along with the flagship all four funds may raise more than US$40 billion.

A spokesman for New York-based Blackstone declined to comment. With low interest rates hobbling investor returns, the industry is benefiting from robust demand for higher-yielding assets.

Yet there's a risk that there won't be enough appetite to meet the vast supply of investment opportunities. Some private equity investors are over-allocated to the asset class. Blackstone beat the previous industry record when it wrapped up its flagship buyout fund in 2019 at US$26 billion.

Last week, Bloomberg reported that Blackstone may seek as much as US$10 billion for a growth fund after wrapping up the previous one earlier this year.

Its rivals haven't been far behind. As at July, Carlyle Group Inc was seeking as much as US$27 billion for its latest flagship fund. That same month, Hellman & Friedman collected US$24.4 billion for its biggest pool on record. BLOOMBERG