Macquarie launches private equity fund

Macquariewill open its newest private equity fund to retail investors, aiming to attract up to $150 million from them, based on the success of a similar fund launched in 1999.

The Macquarie Private Equity Trust II will put aside a slice of $150 million for retail investors while institutional investors will make up the remaining targeted figure, which is understood to be around $400 million.

The fund will be launched by Macquarie Direct Investment (MDI) which has invested more than $320 million in 40 companies over 19 years of investing in private equity. The unit claims returns of 23.5 per cent for all investments, which is more than 10 per cent above the All Ordinaries Accumulation Index over the same period.

MDI managing director Sandy Lockhart says making the fund available to retail investors as well as institutional investors is a priority for the group.

“Through an investment in private equity, investors can get in on the ground floor of exciting private company investments which offer significant prospects for expansion, but which have historically been difficult for individuals to invest in,” he says.

The size of the private equity industry now stands at $9.3 billion in Australia, according to Macquarie, with 2001 heralding in more than $1.4 billion in investments in private companies.

“The universe of private company investment opportunities — totalling more than 40,000 private companies — far exceeds the size of the listed companies market and typically has far stronger expansion prospects,” Lockhart says.

The fund will be open for investing between April 22 and July 12 this year, while the wholesale component will be launched on April 23.