Investors in Bain Capital’s 12th buyout fund are split into “two distinct classes” paying different management fees and carry percentages, according to documents prepared for a US pension and seen by pfm.
Class A investors will pay a management fee of 1.5 percent and 20 percent carried interest, while Class B investors will pay a management fee of 0.75 percent and 30 percent carried interest, the documents by Portfolio Advisors for Pennsylvania Public School Employees’ Retirement System show.
The firm “improved” its fee and carry structure starting with the $6.5 billion Fund XI, according to the documents. Bain Capital will make a minimum $800 million GP commitment to its 12th buyout fund “to invest in or alongside the fund.”
The documents show that Bain typically underwrites its investments to target at least a 20 percent gross internal rate of return and a 2.5x gross multiple of money.
The firm is expecting to hold a first and final close on the fund in July on its hard-cap. Bain Capital Fund XII is seeking $7 billion in limited partner commitments, and the firm expects to cap the fund at 10-15 percent above target, implying a cap ranging from $7.7 billion to $8.05 billion.
The fund is expected to make 15-20 investments, writing equity cheques ranging from $200 million to $500 million, with the ability to pursue transactions up to $1 billion. It will primarily seek investments in North America-headquartered companies, but may make investments elsewhere.
Fund XII “may make investments using either equity and/or debt instruments. The fund may also make investments in temporary (ie, bridge) financing instruments too,” the documents note.
The length of the fund’s bridge financing facility was undisclosed.
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