Kevin Dowd December 28, 2016
Clayton, Dubilier & Rice has raised roughly $6 billion for its latest private equity fund in barely more than two months, already drawing near the vehicle’s $8.5 billion target, according to Reuters. CD&R reportedly expects to reach a $9.4 billion hard cap on the fund sometime next quarter, making it likely the vehicle will be the first mega-fund to close in 2017.
Nearing the $10 billion mark would be a significant increase in fund size for a firm that’s spent the past decade pursuing gradual growth. The Clayton, Dubilier & Rice Fund IX closed on $6.4 billion in 2013, which followed a $5 billion Fund VIII in 2009 and a $4 billion Fund VII in 2006.
Why the quick uptick after previous stagnancy? Part of the reason, surely, is the rapid performance improvement of CD&R’s two most-recent vehicles. Here’s a rundown of the firm’s past four funds:
As you can see, the difference is stark. The firm’s Fund VI ranked in the lower-mid quartile of its peer benchmark, according to the PitchBook Platform, while CD&R IX currently ranks in the top quartile of its cohort.
Only three buyout funds this year raised more money than the reported $9.4 billion hard cap of CD&R’s new fund. What were they? Check out our recap of the five biggest PE deals, exits and funds of the year to find out.