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Laxman Pai, Opalesque Asia: The unlisted natural resources market remains crowded, though the number of funds on the road and aggregate capital targeted have dipped slightly in the past few months, said a study.
According to the Preqin report, at the start of April 2020, 332 funds are seeking capital. Collectively, these funds are targeting $172bn from investors, which is down from $215bn at the start of the year.
The report 'Preqin Quarterly Update Natural Resources Q1 2020' revealed that North America- and Europe-focused funds in the market are targeting the most capital in Q1 2020, and similar quantities ($67bn and $64bn respectively).
Despite this, there are almost 70 more vehicles targeting North America than Europe, indicating much larger target sizes on average for Europe-focused funds.
In a market historically dominated by North America-focused funds, fund managers are confidently making strides to establish and grow in other regions.
The make-up of funds in the market by strategy continues to follow tradition, however. Seven of every 10 funds in the market are targeting energy investments, and together these vehicles are seeking $139bn.
Agriculture/farmland and diversified natural resources funds add only $9.7bn and $14bn to the total capital targeted respectively.
Since fund managers typically adapt to investor appetite when bringing funds to market, interest in energy funds remains robust. ...................... To view our full article Click here
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