Biggest Middle East PE Firm Targets Larger North American Deals

Investcorp Holdings BSC is targeting larger private equity deals in North America as it seeks to boost assets under management to $50 billion.

The biggest private equity and alternative asset manager in the Middle East sees buyouts in that region representing one of its best avenues to growth, David Tayeh, head of North America Private Equity, said in an interview. The firm is also looking at more co-investments as a way of participating in bigger deals, he said.

“We want to grow our capacity to invest and broaden the top of the funnel of investments that we can look at from a size perspective,” said Tayeh. “At the moment there are deals that we really like that we don’t pursue because they’re outside our size range.”

Investcorp, which counts Abu Dhabi sovereign wealth fund Mubadala Development Co. as a major investor, outlined a plan to double its assets under management from about $25 billion in 2018 within seven years. It is targeting a combination of acquisitions and boosting its existing private equity, real estate and alternative investments units.

The firm now manages assets of $35.4 billion. Built on funneling money from rich Middle East families and sovereign funds into the U.S. and Europe, Investcorp is now expanding into Asia while looking to manage more cash for Western investors.

It raised about $1 billion for a new North American buyout fund to help book bigger deals, people familiar told Bloomberg in March. Tayeh declined to comment on the new fund.

Investcorp currently focuses on mid-market deals in the U.S. of companies with an enterprise value of up $750 million, he said. That number could gradually increase to up to $3 billion, he said without giving a time-frame.

Established in 1982, the asset manager is already the Gulf’s largest private investor in U.S. real estate. It partnered with Trilantic Capital Partners last month to acquire acquired RoadSafe Traffic Systems Inc. for about $500 million, people familiar said at the time. The firm spent $330 million buying apartment properties in U.S. suburbs in January.

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