Despite the shortage of liquidity in global financial markets, one private equity fund is still planning to invest billions of dollars in emerging markets, with a keen focus in particular on South Africa.

Actis, the private equity group focused on emerging markets, said it expects to invest as much as $1bn of its total $2.9bn private equity fund into Africa, with more than half of that amount earmarked for buyout and growth deals in South Africa.

The $2.9bn fund, which closed to new entrants on Monday, is known as Actis Emerging Markets 3 (AEM3), and exceeded expectations beating its previous target of $2.5bn.

Some cash from the fund has already been used, following the $700-million acquisition by Actis and the Old Mutual Investment Group of electrical engineering and manufacturing firm Alstom South Africa. Actis is the biggest shareholder with 35% of the total holding.

The aim of the AEM3 fund is to establish a diverse portfolio of between 30 and 40 investments across Africa, China, India, Latin America and South East Asia.