Apollo Global Management is upholding limits on investor withdrawals from its flagship private-credit fund after a surge in redemption requests during the second quarter.
In a Monday filing with the U.S. Securities and Exchange Commission, the private markets giant said it will continue to cap redemptions at 5 percent of outstanding shares in its roughly $15 billion Apollo Debt Solutions fund. Investors had sought to withdraw about $2.4 billion, or 16.8 percent of the vehicle’s net asset value, during the most recent quarter.
Apollo also told federal regulators that redemption requests showed a “notable regional split.” Clients in the United States sought to redeem about 4.3 percent of shares, while requests from offshore investors rose to 12.5 percent.
The firm said it recorded $300 million in new commitments to Apollo Debt Solutions during the quarter. Taken together with the redemption cap, it said net outflows would be limited to about $400 million.
Apollo previously told the SEC that it had received redemption requests equal to 11.2 percent of outstanding shares during the first quarter and that it would adhere to the fund’s 5 percent quarterly redemption limit, a standard across the private-credit industry.
In a message aimed at reassuring investors, Apollo’s managers emphasized that, excluding software, new-issue spreads are essentially unchanged from the start of the year.
Exposure to software companies has become a growing concern for investors in private-credit markets. Some worry that advances in artificial intelligence could disrupt traditional software business models or intensify competition across the sector.
“We believe challenges are largely confined to the software sector and like other cycles that have come before, are likely to take time to play out, but in time dispersion among managers will become apparent,” Apollo said.
“The vast majority of investors in the Fund continue to choose to remain invested.”
Apollo is not alone. Several business development companies and evergreen private-market funds—that offer wealthy individual investors exposure to higher-yielding private-credit or private-equity assets—have faced unusual liquidity pressure in recent months.
In April, Blue Owl told investors it was limiting withdrawals from two funds after receiving a record level of redemption requests in the first quarter. Investor concerns about artificial intelligence were cited as a key factor behind withdrawals from its technology-focused fund.
Earlier in June, Blackstone, the world’s largest alternative asset manager, said it had restricted investor withdrawals from its $79 billion Blackstone Private Credit Fund, or BCRED, to 5 percent of outstanding shares after redemption requests reached 10 percent during the second quarter.
Investors in rival BlackRock’s $25 billion private-credit fund, known as HLEND, also asked to redeem a collective 13.3 percent of its shares in the second quarter, up from 9.3 percent in the previous period. BlackRock said earlier this month it would stick with its previously stated 5 percent threshold and cash out shareholders on a prorated basis.
Across the Atlantic, Switzerland’s Partners Group also curbed redemptions from its $8.6 billion Global Value SICAV fund, one of its evergreen European private-equity vehicles. The firm, which operates in both Europe and the United States, said in June it would limit withdrawals to 5 percent in the second quarter after redemption requests rose to nearly 10 percent of the fund’s value.
