WRAPUP 3-Partners Group cap fuels fresh concern over private markets

Wed, 03rd Jun 2026 21:59

* Partners Group leads slide in private equity-linked shares

* Swiss company limits withdrawals on major ⁠evergreen PE fund

* Selloff points to private credit fears spreading

* Cliffwater reports heavy second-quarter redemptions

ZURICH/LONDON, June 3 (Reuters) - Partners Group said on Wednesday it capped withdrawals from an $8.6 billion private equity fund, reigniting investor worries about the risks of popular alternative investments and spurring a broad retreat ‌in the shares of global asset managers.

The Swiss-based middle-market alternative asset manager, which oversees about $185 billion, cited industry-wide volatility across open-ended evergreen funds since late 2025, starting in private credit and spilling into private equity.

Evercore ISI analyst ⁠Glenn Schorr said the move was significant because it was the first scaled private equity evergreen fund ⁠to follow the redemption caps set by some private credit firms after investors sought to pull funds.

"Investors are hypersensitive to any slowdowns in retail trends given contagion risk beyond private credit," he said.

Partners Group said in a statement that net redemption requests had exceeded 5% of the net asset value of its Partners Group Global Value SICAV fund. Until Wednesday, investors had been focused on problems appearing in loans by private credit funds run by big asset managers, focusing on valuations, lending ‌standards and how software companies can handle AI challenges.

The Partners Group disclosure shows private equity funds are not immune to volatile valuations and anxious clients, and its shares fell 16% to a six-year low in Zurich.

"Some of this redemption pressure that started in private credit has started to make its way over into other asset classes," Partners Group CEO David Layton told Bloomberg TV.

Individuals were behind most of the redemptions, but 80% of the firm's investors are long-term institutional investors.

"Private wealth clients are the weak link," said Aneeka Gupta, director of research at WisdomTree, adding they are usually quicker to withdraw money than institutional investors.

"Evergreen funds were sold to retail investors as a way to get private equity liquidity, but private equity is inherently illiquid," she ‌said. "When enough people test that promise at once, the gates come down."

WIDER FALL IN PRIVATE EQUITY SHARES

Some investors have expressed fears about opaque valuations and exposure to AI at private equity funds, which typically invest in shares, and Wednesday's statement by Partners Group further fueled ‌those concerns.

Shares in Sweden’s EQT were down more than 6%, CVC Capital Partners fell 7.5% and Britain's Bridgepoint Group was 10% lower, while in the United States, asset managers Blackstone, KKR, TPG and Ares Management each slid 4%.

Many of the firms are trading near the low end of their 52-week ranges, reflecting concerns about private markets investments and fears problems there will hit other financial firms. Goldman Sachs and Morgan Stanley dropped 2%, although both are trading near recent highs.

"The share price reaction implies that the outflows from the Global Value Fund are merely the beginning and will spill over to other ‌investment vehicles," said Vontobel analyst Andreas Venditti. "Given the current focus on private credit, the market is highly sensitive to negative news."

Redemption windows at key U.S. non-traded private credit funds for the second quarter began closing last Friday. The closures will be spread across June and market participants are closely watching for subsequent updates on withdrawal requests.

Cliffwater was first to report second-quarter redemptions on Tuesday, with withdrawal ⁠requests at its ⁠flagship $31.3 billion private credit fund rising to 17% from 14% in the first quarter.

Redemption requests across U.S. non-traded private credit vehicles ‌rose as high as 41% in the first quarter, prompting most managers to enforce the typical 5% limit on withdrawal requests, curtailing liquidity for investors.

Analysts have backed the move to limit withdrawals as it would help mitigate the risk of forced asset sales.

Partners Group said the underlying fund's liquidity position remains within its target, supported by ongoing distributions from its underlying portfolio and an undrawn credit facility.

The Global ‌Value Fund and the underlying fund continue to invest and remain open for applications, it added. Of the Global Value Fund's top 10 direct holdings, four are in technology, a March filing showed. Layton said Partners Group's exposure to software assets was under 10%.