UPDATE 2-Ares private credit fund limits investor withdrawals after redemption requests surge
Apollo Global Management Inc APO | 0.00 | |
Ares Management Corporation ARES | 0.00 | |
Blackstone Inc. BX | 0.00 |
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March 24 (Reuters) - Ares Management's ARES.N private credit fund has limited redemptions at 5% after investors sought to withdraw roughly 11.6% of the total outstanding shares, according to a regulatory filing on Tuesday.
The move mirrors similar recent decisions by rival private capital firms to cap redemptions at the 5% limit, including Blackstone BX.N and BlackRock's HPS Corporate Lending Fund.
Investors have pulled billions of dollars from some of the biggest private credit funds in recent months amid a barrage of negative headlines around the roughly $2 trillion industry.
The majority of the redemption requests at Ares' private credit fund were made by a limited number of family offices and smaller institutions that represent less than 1% of its over 20,000 shareholders, it said.
Ares Strategic Income Fund will return $524.5 million, or 5% of its outstanding shares, it said.
"We have made this decision, as with all capital allocation decisions, aligned with what we believe are the best interests of the Fund and all of our stakeholders," Ares Strategic Income Fund said in a letter to shareholders.
Shares of Ares Management, which managed roughly $623 billion in assets at the end of 2025, fell 3% in premarket trading.
Apollo Global's APO.N $25 billion private credit fund, Apollo Debt Solutions (ADS), also capped redemptions at 5% on Monday after investors sought to withdraw roughly 11.2% of its outstanding shares.
Analysts say private credit funds are facing their first industry-wide litmus test amid elevated redemption requests, and how they navigate the next several quarters will likely shape their relationships with investors for years to come.
Many on Wall Street have drawn parallels to the redemption wave that hit non-traded U.S. real estate income trusts a few years back, when valuation jitters spooked some investors.
"While we expect redemptions to remain elevated over the next few quarters, there is now a healthy precedent for prorating redemptions," Evercore analyst Glenn Schorr said.
