Goldman closes biggest ever buyout fund

Investment bank Goldman Sachs has raised $20 billion for its sixth buyout fund, the first firm ever to reach this mark - although rival private equity groups are reportedly closing in on even larger totals.

Goldman Sachs Capital Partners has closed GS Capital Partners VI on $20 billion (€14.7 billion), making the investment banking firm the first to close a mega fund of such proportions and putting it in direct competition with some of its own private equity clients.

The New York-based firm said the total capital raised for the fund – which is double its original $10 billion target – includes $11 billion from institutional investors and high net worth individuals, as well as a massive $9 billion from the firm and its employees.

GSCP VI will participate in buyouts, recapitalizations, and growth investments “across a broad range of industries and will seek to create value through meaningful involvement with portfolio companies’ strategic decision-making and operating philosophy”, the firm said in a statement.

Private equity firms, for which Goldman frequently provides funding, are currently raising similarly sized funds: Kohlberg Kravis Roberts is reportedly north of $20 billion for several buyout funds, while The Blackstone Group has already raised more than $18 billion for its latest fund, which is expected to close on or above $20 billion.

Goldman’s last similar fund, GS Capital Partners V, closed in 2005 on $8.5 billion. Its Capital Partners division was established in 1991 as part of the firm’s Principle Investment Area, which has raised $56 billion across 13 investment vehicles.