Shares of private market investment firms came under pressure on Wednesday after Switzerland-based Partners Group announced it was capping withdrawals from one of its flagship private equity funds, reviving investor concerns about liquidity across the alternative asset management industry.
Partners Group shares fell 16% in Zurich trading after the company confirmed that redemption requests for its $8.6 billion Global Value SICAV fund had exceeded a pre-defined threshold, automatically triggering withdrawal limits.
The selloff spread across the sector, weighing on both European and US-listed alternative asset managers.
In the United States, Blackstone shares BX fell 4.46%, KKR declined 4.18%, Ares Management lost 4.3%, and Blue Owl Capital dropped 2.9%.
Redemption requests trigger withdrawal cap
Partners Group said total net redemption requests submitted during the second quarter exceeded 5% of the fund’s net asset value, activating withdrawal restrictions under the vehicle’s governing structure.
According to the company, the cap was triggered by elevated investor withdrawals rather than any operational issue with the fund itself.
Bloomberg reported that nearly twice the allowable level of redemption requests had been submitted.
Chief Executive Officer David Layton said individual investors accounted for most of the withdrawal pressure, despite institutional clients representing roughly 80% of the firm’s investor base.
“This feature of capping redemption requests at 5% of the fund is a key attribute of this fund,” Layton said. “It’s known that in an environment where investors get a little bit more skittish, like today, you won’t see huge amounts of outflows.”
The fund contains a combination of private equity investments and other private market assets.
According to a March filing, four of its 10 largest direct holdings are technology companies.
Partners Group said volatility that initially emerged in private credit vehicles has increasingly begun affecting private equity investments as well.
Liquidity fears spread across the sector
The announcement reinforced broader concerns surrounding liquidity in private market funds, where investors often face restrictions on withdrawals due to the illiquid nature of underlying assets.
The alternative asset management industry has faced growing scrutiny this year as investors assess exposure to highly leveraged software companies and other assets that could face pressure from artificial intelligence-driven disruption.
Limited transparency into the underlying holdings of many private credit and private equity funds has added to investor caution, making it difficult for markets to fully assess portfolio quality.
The impact was felt across Europe, where shares of EQT fell 6.5%, CVC Capital Partners dropped 7.5%, and Bridgepoint Group declined around 9.8%.
Despite the increase in redemption requests, Partners Group said the underlying fund’s liquidity remains within its targeted range, supported by ongoing investment distributions and access to an undrawn credit facility.
The firm added that both the Global Value Fund and its underlying vehicle remain open to new investments.
KKR faces additional pressure
KKR shares were also weighed down by company-specific concerns tied to its credit operations.
Investor sentiment weakened after a Fitch report maintained a negative outlook on FS KKR Capital Corp., citing ongoing asset quality issues.
Legal developments and class action reminders related to alleged portfolio overvaluation within certain managed funds have also added to the cautious tone.
In addition, analysts have recently lowered earnings expectations for KKR, while the firm’s $900 million debt offering priced at a 7.5% interest rate has highlighted rising funding costs that could pressure future returns.
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