PAI Partners Said to Raise $1.9 Billion for Sixth FundKiel Porter
PAI Partners SAS, France’s largest private-equity firm, raised 1.4 billion euros ($1.9 billion) over 10 months for its sixth buyout fund, according to two people with knowledge of the situation.
PAI managers told investors today that the firm held a first close, the point at which it can begin spending the capital, for PAI Europe VI, said the people who asked not to be identified because the information is private. The new pool has a cap of 3 billion euros.
The pool is the first to be raised since Dominique Megret stepped down as chief executive officer in 2009 following a dispute with other partners and their biggest backer and former parent, BNP Paribas SA. The company allowed investors to reduce their commitments to the fund, cutting it to 2.7 billion euros.
Megret’s replacement, Lionel Zinsou, will depart as CEO in 2015 to be replaced by Chief Investment Officer Michel Paris, the people said. A spokesman in London declined to comment.
PAI, based in Paris, had used a technique known as “dry closing” for the new pool. Investors participating in a dry close formally pledge money to a fund, without being charged management fees or required to hand over capital immediately.
Private-equity firms typically pool money from pension plans and endowments with a mandate to buy companies within five to six years, then sell them and return the money and a profit after 10 years. The firms usually charge a management fee of as much as 2 percent and keep 20 percent of the profits from investments.