A record US$6 billion Asia fund announced by US private equity firm KKR & Co yesterday will be deployed at a time when an economic slowdown and emerging market sell-off has knocked the overall value of Asia Pacific corporations to historic lows.

While the market volatility should offer KKR opportunities to buy low, the record of the private equity industry in Asia shows that investing in the region is not as easy as it seems.

Regulatory hurdles, cultural obstacles and wild market swings have forced global buyout firms to swallow smaller investment returns than expected, with the exception of a few home run deals.

But KKR, a storied firm that pioneered the leveraged buyout back in 1976, has managed to find success in Asia even after arriving later than rivals.

The firm has invested and exited China Modern Dairy Holdings Ltd, Singapore tech firm Unisteel, Japanese recruitment firm Intelligence, and remains invested in South Korea beer and baiju spirit maker Oriental Brewery.

That success has spurred investors to return to KKR's second Asia-focused fund in droves, despite firms across the region facing a shortage of money amid concerns of credit tightening.

"In private equity, you can make a lot of money in horrible macro environments," said Doug Coulter, head of private equity for Asia Pacific at LGT Capital, which allocates money to private equity funds. He was speaking at a Hong Kong Venture Capital Association event last month.

Most private equity portfolios have a few investments that may prove to be more difficult than expected. For KKR, the stake it purchased in Chinese investment bank CICC looks to be under pressure. The bank, once China's top investment bank, has steadily lost market share since the KKR deal, hit by tough competition and a steep slowdown in Chinese stock issuance.

The MSCI Asia Ex-Japan index is trading at 1.4 times book value, 25.4 percent below its 10-year median value, according to Thomson Reuters Datastream.