Ares Fund Caps Withdrawals
Ares Management limits withdrawals at 5% from one of its private credit funds as redemption requests climb to 14.4%.
4%. 6% in the first quarter, prompting the firm to cap outflows at 5%. , accounted for nearly half of the redemption requests, despite representing less than 1% of the fund’s more than 20,000 shareholders. Nearly two-thirds of the requests came from investors who had also sought redemptions in the first quarter.
4% of common shares outstanding," Ares said in the letter, cited. " Ares also told investors that the fund expects to work through the bulk of pending second-quarter redemption requests by the end of the year, if future withdrawal demand remains consistent with current trends. 87%, Unfulfilled repurchase requests This is the latest private credit firm to cap redemptions amid turmoil in the sector. 8% of their shares.
The flagship private credit fund of Cliffwater LLC capped redemptions at 5% in the second quarter after investors sought to redeem approximately 17% of the fund’s shares. 6 billion Global Value SICAV fund after redemption requests exceeded 5% of the net asset value, a move that rattled sentiment across private markets. The firm pointed to instability across open-ended vehicles since early last year, beginning in private credit and later affecting private equity, BlackRock, Ares Management, JPMorgan and Morgan Stanley capped redemptions, in the first quarter.
JPMorgan CEO Jamie Dimon recently cautioned that periods of calm in credit markets often mask the buildup of risk, warning that performance typically deteriorates more than expected once the credit cycle turns. "I do think when we have a credit cycle because there have been weakening standards in underwriting and transparency and marking, I do think you’ll see credit perform worse than people expect. That’s all. I don’t think it’s systemic," he said during the Reagan National Economic Forum.
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