Consumer-focused PE firm L Catterton raises $1.45b for third Asia fund

L Catterton Asia managing partner Chinta Bhagat

L Catterton, the $15 billion private equity firm co-founded by luxury-goods maker LVMH Moet Hennessy Louis Vuitton SE, has closed its third Asia fund to back more retail and healthcare companies across the region.

L Catterton Asia 3 had a target of $1.25 billion, but remained open after additional investors expressed interest, according to Managing Partner Chinta Bhagat. The fund eventually raised just under $1.45 billion, with less than half deployed.

Its establishment comes despite challenges for consumer brands amid trade war concerns and slowing economic growth in China. L Catterton is betting that growing demand for improved medical and retail experiences among Asia’s affluent will help offset these pressures.

“I don’t think countries — I think cities,” Bhagat said in his first interview since joining the firm. “About 50% to 60% of the GDP that matters for a business like ours rests in first tier cities, and they’ve become enormous, with between 10 to 20 million people.”

Bhagat joined L Catterton in August from Malaysia’s Khazanah Nasional Bhd., estimated by the Sovereign Wealth Fund Institute to have $37 billion in assets under management. He leads L Catterton’s Asia platform with co-managing partner Ravi Thakran.

China, Southeast Asia

L Catterton Asia 3 will run for 10 years and seek deals across China, Japan, India, Southeast Asia, Australia and New Zealand. While the company’s stated average ticket size in Asia is between $50 million to $150 million, Bhagat said the size of the latest fund means it will largely focus on transactions north of $100 million.

Examples of investments could be a chain of dental clinics that also offer cosmetic services, he said.

But L Catterton will also play to its strengths by helping retail brands grow. Its staff have experience in picking store locations and finding partners — vital when trying to beat off bigger rivals offering richer valuations, like SoftBank Group Corp.’s Vision Fund.

L Catterton’s first Asia fund is on track to deliver a return of around 2 to 2.5 times, Bhagat said.

“The simplest way to think of the strategy is anything you can build a consumer brand around,” he said. “If you came to me and said ‘Here’s the Ikea of Asia,’ just as an example, would we look at it? Of course we would because it fits the capability side for our ability to add value and make money.”

Bloomberg

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.