London-headquartered Intermediate Capital Group (ICG) has closed its first Asia-focused mezzanine capital fund on $500 million (€412 million).
The fund attracted $300 million from third-party investors, while the remaining $200 million will come from ICG’s own coffers. ICG had initially aimed to raise $400 million, half from third-party investors, the remainder from its own capital.
ICG isn’t new to the region, having set up its Asia Pacific office in Hong Kong back in 2001. Previously, it provided mezzanine financing for deals in the region from its own proprietary capital, according to Piers Millar, head of ICG Asia Pacific.
“Over the last twelve months, there has been a dramatic increase in the number and size of private equity funds in the region,” said Millar. “We believe that this will lead to more, and larger deals. In the medium term we are optimistic about private equity investment in Asia, but we remain cautious in our approach as we believe that Asia is still at an early stage of development.”
ICG has so far completed three deals Asia, providing a total of $126 million in mezzanine financing: two in Korea, and one in Singapore. Most recently, it provided $79 million of mezzanine funding for the buyout of Himart, a Korean retailer of consumer electronics and home appliances, led by Affinity Equity Partners Asia.