Morgan Stanley raises $1.5 billion for new Asia fund

Morgan Stanley’s Asia private equity group has raised $1.5 billion for the firm’s third Asia-focused fund, underlining the US bank's renewed commitment to the asset class.

Morgan Stanley Private Equity Asia, which is part of Morgan Stanley’s merchant banking division, has raised $1.5 billion (€1 billion) for an Asia-dedicated fund, almost triple the amount raised for its 2005 vintage offering, which closed on $515 million.

In addition to the bank’s sponsorship, Morgan Stanley Private Equity Asia III attracted commitments from global institutions and high net worth individuals and the bank’s employees. The fund is Morgan Stanley’s second purely Asia-focused private equity fund although in 1993 the bank had an emerging markets fund that was invested primarily in the region.

Chin Chou, chief executive officer of MSPE Asia said: “We will continue our value oriented investment strategy, focused not only on opportunities in China, South Korea, Singapore and Taiwan, where we have established track records, but also on other important markets such as Japan, India and Australia.”

Chin leads a team that has made a number of investments across Asia including Belle International, a women's footwear maker, Dongxiang Sports and Shanshui Cement in China; Rotem and Ssangyong Corporation in South Korea; CTCI Corporation, an engineering and construction firm in Taiwan; and Asia Capital Reinsurance in Singapore.

Hans Schuettler, chief executive officer of Morgan Stanley in Asia said the fund  demonstrates the bank’s commitment to “principal investing in the region, not only in private equity, but also in real estate and other opportunities across the capital structure.”

Morgan Stanley’s return to private equity investing elsewhere gained momentum this week, as the US investment bank added a managing director and re-branded its Morgan Stanley Capital Partners division Morgan Stanley Private Equity.

Seasoned chief executive Gary Matthews will join Morgan Stanley Private Equity as a managing director and operating partner. His experience includes leading both public and private equity-backed company business units at firms including Simmons Bedding Company, Bristol-Myers Squibb and Derby Cycle Corporation.