Private credit contagion hits private equity as redemptions climb

The pressure on Partners Group, which oversees approximately $185 billion, follows a pattern of liquidity strains across the sector. While firms like Thoma Bravo have already begun handing software assets like Medallia to lenders, the contagion is now hitting the gatekeepers of private capital. Shares in Partners Group stumbled following the announcement, dragging peer valuations lower across both European and U.S. markets.

Investors are increasingly wary of the transparency and valuation models underpinning these evergreen funds. This liquidity crunch is not isolated; Blackstone’s private credit fund recently capped withdrawals at 5% after facing requests for double that amount. Similarly, Cliffwater’s $31.3 billion fund restricted redemptions after a 17% surge in investor exit requests. With $7.1 billion already pulled from eight major vehicles in the first quarter of 2026, the era of unchecked growth has stalled. U.S.-focused direct lending issuance plummeted 40% to $44.76 billion in the second quarter, forcing managers to pivot toward cash preservation over transaction growth.