'Goldfinger' points fund at China
Mount Kellett Capital, run by former Goldman Sachs partner Mark 'Goldfinger' McGoldrick, has recently raised more than US$4 billion for a new private equity fund focusing on the United States and China.
Mount Kellett Capital, named after an area on The Peak in Hong Kong, raised the money for its second fund, which was recently closed and is ready to invest, according to people familiar with the matter.
In 2009, the firm raised about US$3 billion for its first fund MKCP I. The investment firm has offices in Hong Kong and New York.
The size of the new fund, surprised many veterans in the private equity industry, which has found it harder to raise capital amid the worsening debt crisis in Europe and the economic slowdown in China.
'These former Goldman Sachs bankers are understood to be pretty good at fund-raising given their impressive investment record and wide network in the financial and corporate world,' said one private equity industry executive close to MKC.
'For many other funds, 2012 doesn't look like an easy time to raise money at all,' he added.
McGoldrick earned his nickname 'Goldfinger' on Wall Street while at Goldman Sachs. He was co-head of its global special situations group, which is believed to have been one of the New York-headquartered investment bank's most profitable businesses.
McGoldrick is believed to have earned between US$40 million and US$70 million annually at Goldman Sachs. He left Goldman Sachs and launched MKC following the 2008 global financial crisis, with his old company agreeing to contribute capital to help launch the first fund.
Leaving a well-paid but high-pressure investment banking career to join the private equity business has been a trend since the financial crisis.
Hong Kong tycoons were among the institutional investors in both funds, according to a person who declined to be identified as the fund-raising process is private.
MKC has invested about a third of its first fund in the US market, including low-profile but high-profit deals involving distressed assets. So far, the firm's investment strategy in Asia, especially China, has been more conservative. For the second fund, MKC aims to invest more in China. It is hiring junior and middle-management staff, according to people familiar with the matter.
To speed up its plan to expand into the mainland, MKC is also considering opening a representative office in Beijing or Shanghai as its competitors Blackstone and Carlyle have done, these people said.
The history of private equity investment in Asia is relatively short. In Hong Kong and mainland China, many local private equity dealmakers run funds of between US$500 million and US$1 billion.
A fund manager's standard fee based on gross profits in private equity fund deals
- The management fee is usually 2 per cent