Morgan Stanley Private Equity Asia has raised $1.7 billion (£1.0 billion) in its fourth investment fund focused on Asia.

The fund beat its $1.5 billion target having received better than expected interest from the US, Middle Eastern and European investors. 

Investors in the fund include US state pension plans, financial institutions, endowments and high net worth individuals, the firm said. The institutional participation in the fund is double that of the previous fund. 

 

One of the investors is understood to be The Pennsylvania Public School Employees' Retirement System which invested up to $100 million.

In May US private-equity firm TPG Capital closed its $3.3 billion Asia-focused vehicle while CVC Capital Partners' secured $3.5 billion. 

It has already completed two investments with China and Korea major targets for the fund.

“One of the key focus areas for Fund IV will be China,” said Homer Sun, chief investment officer, MSPE Asia. In addition, we have been active in Korea, particularly in the buyout space, and as such we expect Fund IV to aggressively pursue opportunities in that market,” he added.

Morgan Stanley Private Equity Asia has invested around $2.5 billion (£1.45 billion) in more than 50 investments in the region in the past 20 years.