Partners Group Caps Withdrawals from $8.6 Billion Fund, Shares Drop 17%
Partners Group Faces Redemption Pressures and Market Impact
ZURICH, June 3 (Reuters) - Switzerland's Partners Group on Wednesday said it is capping withdrawals from an $8.6 billion private equity fund amid elevated redemption pressure, sending shares plunging by a record 17% in morning trading, a sign that investor worries about private credit are spilling over into other parts of the markets.
Redemption Requests and Fund Response
In a statement, Partners Group said total net redemption requests submitted for the second quarter exceeded 5% of the net asset value of the Partners Group Global Value SICAV, the underlying fund of the Partners Group Global Value Fund.
As a result, the redemption caps are now taking effect, the private markets and investment company said.
Investor Concerns and Sector Trends
Some investors have been seeking to pull their money out of private credit funds in recent months, as worries rise about asset valuations, lending standards and how software companies that have received large amounts of funds can handle the challenges of artificial intelligence.
Of the Global Value Fund's top 10 direct holdings, four are in technology, according to a March filing.
Broader Market Reaction
The news also hit some European private equity peers. EQT shares fell more than 6%, while CVC Capital Partners and Bridgepoint Group dropped 5.8% and 4%, respectively.
Fund Stability and Ongoing Operations
Partners Group, which oversees about $185 billion, said industry-wide volatility across open-ended evergreen funds has been seen since late last year, beginning in private credit vehicles and later spilling over into private equity.
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, the firm said.
Share Performance and Reporting
Wednesday's fall brings the year-to-date drop for Partners Group shares to around 30%.
Bloomberg earlier reported that Partners Group was capping withdrawals from the fund.
(Reporting by Oliver Hirt, Writing by Dave Graham; Editing by Ludwig Burger, Miranda Murray and Thomas Derpinghaus)
