LONDON, May 1 (Reuters) – Ares Management, one of the biggest names in private credit, reported not just a record amount of fundraising this week; it also showed its balance sheet is feeling no stress from the jitters around loans to software businesses.
While the record first-quarter fundraising of about $30 billion was for the entire group, the results showing Ares continued to widen its base of stable institutional clients and grow its credit business seemed to make analysts who have dismissed risks around private credit stresses happy.
Its private credit fund, Ares Capital Corp (ARCC), was first off the mark with March quarter results and indicated that the lender expects limited strain from industry liquidity pressures or its exposure to software companies.
Only a handful of software loans were marked below their December valuations, Reuters found, during a quarter when investors grew wary of technology borrowers vulnerable to artificial intelligence disruption.
The fundraising has been furious.
Sound Point Direct Lending BDC said it had sold 1.9 million shares for $47.8 million.
U.S. alternative credit manager Silver Rock Capital Partners, which invests in both corporate private credit and real asset lending and began as financier Michael Milken’s family office, said it has raised more than $4 billion for its latest tactical allocation fund, LSEG LPC reported.
Reuters reported exclusively that Boaz Weinstein’s Saba Capital Management plans to raise about $1 billion for a new vehicle to buy troubled private credit funds.
Meanwhile, Blackstone’s roughly $80 billion private credit fund BCRED faced weaker investor demand and rising redemption pressure in the first quarter, and cited geopolitical volatility, AI worries and increased scrutiny of private credit as factors in its filing.
BCRED’s filings this week showed gross inflows slowed to $1.9 billion in the first quarter, while repurchase requests rose to $3.2 billion.
Another investor turning cautious is AIG. The insurer said on Friday it had pared back its private credit activity because of market conditions, helping reassure investors and pushing the company’s shares up sharply.
In other news, in a sign of how rapidly the secondary market for private credit and equity assets is expanding, investment bank Lazard said it has entered into an agreement to acquire private equity advisory firm Campbell Lutyens for a total consideration of about $575 million, creating a new private capital advisory division called Lazard CL.
(Compiled by Vidya Ranganathan; Editing by Hugh Lawson)
Comments