Singapore-based, mid-market private equity firm Tower Capital Asia has closed its maiden blind-pool private equity fund at $379 million, surpassing the firm’s original target of $300 million.
The vehicle, Tower Capital PE Fund I, comprises $324 million in primary commitments and $55 million in co-investment commitments, the firm said in a statement.
Limited partners who have committed to the fund include global institutional investors and family offices. The fund had secured a first close of $250 million in January 2021.
Tower Capital PE Fund I has deployed about 40% of the capital into three investments since its formation, including corporate services firm Boardroom Group, ancillary education service provider Indigo Education Group, and English literacy enrichment platform I Can Read Asia.
The fund will continue to invest in the business services, consumer, education, healthcare and manufacturing sectors in Singapore and, opportunistically, in the rest of Southeast Asia.
Danny Koh, founder and CEO of Tower Capital Asia, acknowledged the private equity fundraising environment “has been a challenging one” due to global geopolitical tensions and macroeconomic uncertainties. However, he added: “Relative to other markets globally, Southeast Asia remains a growth haven with robust fundamentals and an expanding private equity opportunity set.”
Founded in 2016, Tower Capital Asia backs mid-market companies with an enterprise value of up to $500 million. Its private equity cheque size is at $50 million minimum, according to the firm’s website. The firm also made investments of $30-100 million in strategic situations, including private credit, mezzanine and structured equity for optimal risk-reward solutions.
Tower Capital Asia works closely with portfolio companies to rejuvenate business models and drive long-term value creation based on the principles of regionalisation and digitalisation.
In addition to the investments from its inaugural fund, other investments include the S$269 million ($197 million) delisting of traditional Chinese medicine healthcare brand Eu Yan Sang in 2016, and the S$276 million ($204 million) take-private transaction of Poh Tiong Choon, one of Singapore’s oldest logistics companies, in 2017.
As of September 2022, Tower Capital Asia manages institutional funds totalling nearly $500 million, across all vehicles.