Patria to launch Fund IV in early 2011

The firm will target slightly more for the fourth private equity fund than the $700m it raised for Fund III. Earlier this year, Blackstone bought a 40% stake in Patria for $200m.

Patria Investimentos, a Sao Paulo-based asset manager Blackstone bought into earlier this year, will look to launch a fourth private equity fund in early 2011, according to a person with knowledge of the firm.

The firm has not determined a final target for the fund, but it will be slightly larger than Patria’s third fund, which closed on $700 million in 2008, the person said. The third fund is more than 50 percent invested, the person said.

Patria could not be reached for comment.

Past LPs include General Electric, JPMorgan Partners and Companhia do Vale do Rio Doce.

Blackstone and Patria announced the deal in late September. Blackstone agreed to pay $200 million for a 40 percent stake of Patria.

“Partnering with Patria will enable Blackstone’s limited partners and advisory clients to benefit from the fast expanding business opportunities in the country, as well as from Patria’s deep knowledge of the local market,” Steve Schwarzman, chairman and chief executive officer of Blackstone, said in a statement at the time.

Patria Investimentos was established in 2003, and has about $5 billion under management. Patria began its merchant banking activities in 1994 and started its private equity business in 1997 in association with Oppenheimer Investment Bank, which has since been acquired by the Canadian Imperial Bank of Commerce.

The firm, led by chief executive and founding partner Luiz Otavio Magalhães, pursues buy-and-build strategies from eight general and specialised funds. The firm focuses include Brazilian post-secondary education and services outsourcing.

Patria will be entering an increasingly crowded Brazilian private equity market that has seen an influx of western based firms chasing deals. The firm’s fundraising could be bolstered by the growing interest on the part of LPs outside of Brazil to get exposure to the country, though it’s not clear what kind of geographic mix the firm will look to achieve in its LP base.