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NewQuest to hold first close on third fund – exclusive

The pan-Asian firm is racing towards a first close on its latest direct secondaries vehicle, Secondaries Investor has learned.

NewQuest Capital Partners, a Hong Kong-based direct secondaries firm, expects to hold a first close on a new secondaries fund in the first quarter, Secondaries Investor has learned.

The firm is back in market seeking $500 million for NewQuest Asia Fund III and is expected to have raised more half of this in the next two months, according to a source familiar with the fundraising.

The fund was launched in the second half of last year and is being raised by UBS, according to another source. Regulatory filings show the vehicle is registered in the Cayman Islands.

The fund is likely to follow a similar strategy to NewQuest’s predecessor, NewQuest Asia Fund II, focusing on direct secondaries deals across Asia. Fund II closed in June 2014 on $316 million, above its $300 million target, after about seven months of fundraising, according to PEI’s Research and Analytics division.

Investors in Fund II include HarbourVest Partners and LGT Capital Partners.

NewQuest and UBS declined to comment.

NewQuest, which was founded in 2011, acquired a portfolio of more than 20 investments when it spun out of Bank of America Merrill Lynch’s Asian Private Equity team.

In September, NewQuest agreed a $542.6 million sale of energy firm China Hydroelectric to Shenzhen Energy, which it had held through NewQuest Asia Fund I and NewQuest Asia Fund II, Secondaries Investor previously reported.

The firm manages over $700 million across two funds and has a pan-Asian focus on markets including China, India, southeast Asia, Japan, South Korea and Australia, according to its website.