Terra Firma, the private equity group run by Guy Hands, is expected to start fundraising within 12 months.
Private equity firms have struggled recently to raise money for funds, and Terra Firma has had a particularly hard time due to the fall-out from its EMI purchase. Investors made heavy losses on the music label after Mr Hands lost control of the business to lender Citi.
The cash in Terra Firma's last fund was drained by last month's £825m purchase of care homes group Four Seasons. Mr Hands has decided to raise money for buyouts on a deal-by-deal basis in the short-term following a similar model being used by Duke Street Capital after it recently failed in a fundraising.
A source close to Terra Firma insisted that "by this time next year there will be money under management from a fundraising". But a market source said it would be at least 18 months.Reuse content