EMR Capital secures $450m to close mining fund

1 February 2015 (Last Updated February 1st, 2015 18:30)

Private equity group EMR Capital founded by Owen Hegarty has secured $450m ($449m) of commitments to close a specialist mining fund.

Private equity group EMR Capital founded by Owen Hegarty has secured $450m ($449m) of commitments to close a specialist mining fund.

The new mining fund has drawn interest from a mix of institutions, endowments and private investors, and will focus on copper, gold, coking coal and potash.

EMR Capital CEO Jason Chang told Reuters: "We think now is a good time to deploy capital into these markets."

"According to the group, more private equities are replacing public capital raisings due to a slump in commodity prices."

EMR Capital said it is looking at the medium to long-term and not concerned about daily fluctuations. According to the group, more private equities are replacing public capital raisings due to a slump in commodity prices.

The $2.5tn private equity industry is dominated by big name funds unrelated to mining, which is perceived as risky.

The mining sector is said to have increased by 30%, with the non-mining sector rising by more than 25%, making it difficult for mining companies to tap into public markets during this time.

More private equity is expected to be invested in mining activities due to these reasons.

The new fund secured by EMR Capital initially had a target of $400m and is set to avoid investments in iron ore. Last year, iron ore prices tumbled by more than 50% and supply is dominated by a small handful of miners.

"Iron ore is probably too much of a niche market," Chang added.