First Reserve’s deal war-chest expands
First Reserve is sitting on another $9 billion of spending money for energy deals after finishing raising its latest buyout fund, Fund XII. The private equity giant, which specialises in energy investments, said the fund is the largest ever raised in the energy sector and exceeds its previous fund, Fund XI, which raised $7.8 billion in 2006.
The fund appears to be lower than target, however. London-based private equity intelligence firm Preqin said in a recent report that the fund had a $12 billion target.
“Energy remains a large, dynamic and complex industry where change creates new, attractive investment opportunities,” said William Macaulay, Chief Executive Officer of First Reserve in the press release (below).
Private equity firms have been struggling to raise new money for funds as the pension and endowment funds that invest in them have been hit by slides in the equity markets.
Some sectors and funds have been more successful than others. Secondary firms, which typically buy investors’ positions in buyout funds at a discount, have been particularly successful at raising capital.