Morgan Stanley limited last week withdrawals from one of its private credit funds, by allowing only 45.8 % of tender requests to be fulfilled.
Morgan Stanley said it would fulfill 5 % equivalent of assets tender requests as of December 31, 2025.
After First Brands, Tricolor, Blue Owl holding redemptions from its OBDC II fund and later selling off 1.4 billion USDs of assets to pension funds and insurance companies to finance withdrawals, BlackRock writing off a loan to 100 %, which only three months before was carried at 100 % on the book, Morgan Stanley holding withdrawals from one of its funds is the latest troublesome sign for the private credit and by extension the largest private equity asset managers Blackstone, KKR, BlackRock, Apolli, Carlyle, Ares, Blue Owl, TPG, EQT, Partners Group etc, and the whole mid cap and small cap private equity business.
Blackstone, KKR, BlackRock, Apolli, Carlyle, Ares, Blue Owl, TPG, EQT, Partners Group etc have lent a large part of their recently, in the last 5-7 years raised assets to artificial intelligence, AI technology and software firms. AI, mainly mid sized, according to some investors is disrupting many software business.
As long as the current artificial intelligence, AI boom does not turn into bust where by the Nasdaq Composite falls by more than 32 % from its recent all time high, Blackstone, KKR, BlackRock, Apollo, Carlyle, Ares, Blue Owl, TPG, EQT, Partners Group etc, and the whole mid cap and small cap private equity business firms should not face solvency issues, according to Wolfteam Ltd.'s projections and estimates.
If the artificial intelligence, AI boom turns into bust and the Nasdaq Composite tanks from 30 % to 62 % from its recent high, Blackstone, KKR, BlackRock, Apolli, Carlyle, Ares, Blue Owl, TPG, EQT, Partners Group etc, and the whole mid cap and small cap private equity business will face huge, possibly existential difficulties.
No comments:
Post a Comment