PAG Asia Buyout Fund Targets USD4bn as Regional Strategy Diversifies

The PAG Asia buyout fund is targeting about USD4bn as the investment firm tests institutional appetite for Asian private equity while reducing its historically heavy exposure to China.

PAG has informed limited partners about the fundraising but has yet to finalise its target, according to people familiar with the plans.

The vehicle could ultimately raise between USD4bn and USD5bn, with an initial close potentially taking place by the end of the year.

PAG's previous buyout fund closed at USD4bn in 2024, substantially below its original USD9bn target as pandemic disruption, tighter Chinese regulation and geopolitical tensions weighed on fundraising.

That fund represented a more geographically diversified strategy, investing roughly evenly across Australia, China, India and Japan.

The firm has returned more than USD7bn to investors over the past 18 months, primarily through realisations of Chinese assets.

The new fundraising will provide another test of institutional investors' willingness to increase allocations to Asian private equity following several challenging years for regional fundraising and exits.