US buyout stalwart Clayton, Dubilier & Rice has hauled around $16 billion for its latest flagship vehicle after returning to the fundraising trail early last year.
The firm exceeded the $13 billion target for Clayton, Dubilier & Rice Fund XI in the third quarter of last year, according to a source familiar with the fundraise.
The New York-headquartered firm had a re-up of about 80 percent for Fund XI, the source added. Fifty-five percent of investors in the fund came from outside the US and more than $1 billion of the capital raised came from Latin American investors.
CD&R’s capital raise follows its most active investment period. It is understood to have struck 13 new fund investments across all of its target sectors – consumer/retail, healthcare, industrials and services/technology – over the last 12 months, and its portfolio companies executed approximately 20-add on acquisitions.
Its investment playbook during the covid-19 pandemic has similar characteristics to its 2008-09 global financial crisis strategy, David Novak, the firm’s co-president and head of Europe, told in July. A key part of investing during market disruption is backing organic growth opportunities as companies take market share as well as through bolt-on M&A, according to Novak. That playbook also includes complex deals such as corporate carve-outs, take-privates and partnering alongside entrepreneurs, family owners and corporates.
CD&R hit the $10 billion mark, or nearly 80 percent of its target, in May, with commitments from global investors including public pension funds, sovereign wealth funds, endowments and foundations, family offices, corporate pensions and financial institutions.
CD&R itself committed close to $1 billion, the California Public Employees’ Retirement System committed $500 million and the California State Teachers’ Retirement System committed $350 million. Cathay Life Insurance, China Life Insurance (Taiwan) and Alameda County Employees’ Retirement Association are also investors in Fund XI, according to PEI data.
The latest vehicle is 60 percent larger than its predecessor, which raised $10 billion including GP commitment in 2017.
The firm’s latest investments include the £308 million ($425 million; €352 million) carve-out of Wolseley, a UK distributor of plumbing, heating and infrastructure & utility products; $4.7 billion in Epicor, a global provider of industry-specific enterprise software to industrial sectors; and an investment in Illinois-based apparel distributor S&S.
Debevoise & Plimpton is understood to have provided legal counsel on the fundraise.