Carlyle launches €3bn European fundraising

The US alternative assets powerhouse is coming back to market with a European offering that will secure its place at the pinacle of the buyout megafunds for now.

Carlyle, a US alternative assets manager, has begun fundraising for its latest European buyout fund, which is targeting €3 billion ($3.8 billion) from investors, according to one who attended Carlyle’s most recent investor conference.

David Rubenstein: heads up Carlyle’s fundraising.

The investor confirmed Carlyle had published a private placement memorandum, kickstarting formal fundraising for its third European vehicle. He said Carlyle’s current pool of capital earmarked for Europe, the €1.8 billion 2003 fund, was 70% invested.

The investor said the reaction to Carlyle’s fund launch had been good, helped by the healthy performance of the current fund. The California Public Employees’ Retirement System website said Carlyle Europe Partners II had returned 2.1 times its money at a net internal rate of return of 46.3% to the end of March.

A report in Financial News, a UK trade paper, said the firm was planning to raise as much as €5 billion, nearly triple the 2003 fund, however, the source said this would depend on investor appetite.

Combined with its other regional funds raised in the past 12 months, the European fund could put Carlyle at the top of the mega-buyout pile, ahead of rivals Blackstone and Texas Pacific.

Carlyle has raised more than $17 billion for its buyout funds, including $5 billion for its regional Asian funds and $7.9 billion for the US market, in the past year.

Blackstone closed its global fund on $15.5 billion this summer, and Texas Pacific Group stopped at $15 billion. Kohlberg Kravis Roberts’ next buyout fund is expected to close soon on about $16.5 billion.

Investments from Carlyle’s second European fund include the buyout of UK car seat manufactruer Britax Childcare for €230 million in October, and Terreal, a French tilemaker , which was acquired for €400 million and sold to LBO France for €860 million.

In the spring thius year Carlyle was part of the consortium to take private Dutch media company VNU for €7.8 billion in the continent’s second-largest buyout.

Carlyle declined to comment.