Hicks Muse Struggles to Raise Money for Fund

Hicks Muse Tate & Furst may take 12 more months to raise its current $4-billion fund, a sign some big investors are wary of putting money with the world’s largest corporate buyout firm.

Dallas-based Hicks Muse has struggled to raise money as bets on fledgling telecommunications companies such as ICG Communications and the nation’s biggest movie theater chain, Regal Cinemas, have plunged in value. Of the $1.2 billion already raised for Hicks Muse Tate Furst Fund V, about $200 million is invested in Internet companies with additional funding going to a sports programming company in Latin America.

A final closing for the fifth fund won’t take place until mid- to late 2001, according to the firm. The fund was started early this year.

This is “one of the industry’s toughest fund-raising environments in many years,” said Chairman Thomas O. Hicks.

In November, Hicks Muse, the biggest buyout firm in terms of capital commitments, made an unprecedented concession to skittish investors and guaranteed some of their returns.

Currently, there are at least 28 buyout firms raising funds of more than $1 billion--the most ever.