Deutsche Bank downgraded Blue Owl Capital (NYSE:OWL) from buy to hold, and cut its price target from $15 to $10.OWL stock has declined 27 percent this month. The downturn comes as the firm halts quarterly redemptions and changes the method by which it was providing them.The firm announced that it replaced its 5% quarterly tender offer with a structured payout in its OBDC II Fund.The sale of OBDC II totaled $600 million or approximately 35 percent of the fund's total assets. The firm plans to distribute most ...

Group 1 - The founder of Arini warns that even before the substantial impact of AI on the software industry is realized, market panic alone is sufficient to increase corporate financing costs, potentially leading to widespread defaults [1] - The software industry is currently experiencing a prolonged sell-off, with investors concerned that the rapid evolution of AI technology poses a fundamental threat to the business models of software companies, which are already burdened with high debt levels relative to their earnings [1] - Direct lending institutions are reducing their exposure, which may exacerbate the impact on the software sector, as companies in this industry typically operate with high leverage and rely heavily on private credit markets [2] Group 2 - The private credit market has expanded rapidly, reaching a size of $1.8 trillion, prompting regulatory scrutiny [3] - The founder of Arini emphasizes that while regulatory tightening does not necessarily reduce investment opportunities, the industry must acknowledge the balance between risk and return [3] - The concentration of private credit in the software sector is deemed excessive, with concerns raised about the wisdom of lending at such levels in a mediocre-performing loan industry [2]

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Things are getting from bad to worse for Private Credit giant Blue Owl Capital.The last time we looked at the firm's precarious liquidity situation about a month ago, we found that the Blue Owl BDC would allow for 17% redemptions as investors, burned by both the tumbling stock price and the company's massive exposure to ticking private credit time bombs, were storming for the exit. Blue Owl BDC Allows for 17% Redemptions as Investors Storm Exit: BBG— zerohedge (@zerohedge) January 7, 2026One month later, it ...

Core Insights - The founder of 26North has shifted his investment focus from private equity to alternative investments, including sports franchise ownership [1] - The founder provides a critical perspective on the current economic outlook and the recent appointment of the Fed chair [1] - An assessment of the private credit market is included, highlighting its current state and potential opportunities [1] Investment Mindset Evolution - The transition from private equity to alternative investments signifies a broader trend in investment strategies [1] - Sports franchise ownership is identified as a growing area of interest within alternative investments [1] Economic Outlook - The founder expresses concerns regarding the economic environment and critiques the policies of the newly appointed Fed chair [1] - Insights into how these economic factors may influence investment decisions are provided [1] Private Credit Market Assessment - The current state of the private credit market is analyzed, with emphasis on its growth and potential risks [1] - Opportunities within the private credit space are discussed, indicating a favorable outlook for certain investments [1]

Financial Data and Key Metrics Changes - Patria reported organic fundraising of $1.7 billion in Q4 2025 and a record $7.7 billion for the full year, exceeding the revised target of $6.6 billion by over $1 billion [5][34] - Fee-related earnings reached $203 million in 2025, up 19% year-over-year, with distributable earnings per share at $1.27 [6][23] - Total fee revenue for Q4 was $101 million, an increase of 8% year-over-year, while full-year total fee revenue reached $344 million, up 14% [39] Business Line Data and Key Metrics Changes - Infrastructure strategies raised approximately $2.3 billion in 2025, significantly higher than the previous year, driven by strong global interest [11] - The credit platform raised a record $1.8 billion in 2025, surpassing the previous record of $1.4 billion in 2024 [12] - Real estate strategies raised over $520 million in Q4 2025, contributing to Patria becoming the largest manager of REITs in Brazil [14] Market Data and Key Metrics Changes - The Brazilian credit market reached $1.7 trillion in 2024, with an estimated $800 billion addressable market for asset-backed, non-bank private credit [13] - Approximately 90% of Patria's fee-earning AUM is in vehicles with no or limited redemptions, indicating a stable asset base [15][21] Company Strategy and Development Direction - Patria aims to achieve a fee-earning AUM target of $70 billion by year-end 2027, with recent acquisitions expected to enhance capabilities in private credit and real estate [8][10] - The company is expanding its investment strategies, including infrastructure development, private equity buyout, and venture capital, to diversify its performance fee earnings stream [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in meeting 2026 and 2027 fundraising targets of $7 billion and $8 billion, respectively, due to strong demand for their investment strategies [10][34] - The macroeconomic environment is seen as favorable, with financial deepening and deregulation in Latin America driving increased investor interest [28][30] Other Important Information - Patria announced a share buyback program of up to 7 million shares to return capital to shareholders [9] - The company is undergoing leadership changes, with a new CFO set to take over in April 2026 [31][32] Q&A Session Questions and Answers Question: Can you discuss the private equity valuation process? - The company uses an independent appraiser annually to value funds, employing a discounted cash flow model and comparing results with industry multiples [56][58] Question: How do unrealized performance fees affect your financials? - Unrealized performance fees do not impact revenues as management fees are charged based on invested capital, not valuations [62][64] Question: What is the outlook for fundraising in 2026? - The company is optimistic about exceeding the $7 billion fundraising target for 2026, given the strong performance in 2025 [70]

Propy, a real estate technology company, tapped the private credit market for the first time, securing $100 million to support the startup’s acquisition strategy https://t.co/6ieXgvdNIU ...

Core Insights - Sharon AI, an Australian high-performance computing company, has secured up to $500 million in financing from blockchain-based lender USD.AI to expand its GPU infrastructure in the Asia-Pacific region [1] - The financing will support the deployment of compute systems for training and running large AI models, with an initial rollout of $65 million expected to begin this quarter [1] Financing Structure - The agreement allows Sharon AI to access capital through a non-recourse credit facility, where loans are secured by physical GPU hardware instead of corporate assets [2] - USD.AI's onchain lending system tokenizes verified GPU deployments as collateral, enabling lenders to track performance without traditional credit checks [2] Market Dynamics - The structure aims to accelerate growth for AI infrastructure providers while avoiding slower traditional financing methods, highlighting the role of tokenization in the private credit market [3] - The private credit market's limited liquidity and transparency make it suitable for blockchain solutions, which can enhance safety and accessibility through improved price discovery and reporting [4] Future Outlook - USD.AI has approved over $1.2 billion in GPU-backed facilities for other AI infrastructure firms, indicating a growing trend in this financing model [6] - The potential for blockchain to improve transparency in onchain credit markets may reduce fraud and facilitate traditional investors' entry into the market as crypto-backed loans receive ratings from major credit agencies [5]

Core Viewpoint - The firm identifies a buying opportunity in the private credit market despite recent uncertainties and jitters [1] Group 1 - The firm believes that current market conditions present favorable investment opportunities [1] - Recent fluctuations in the private credit market have not deterred the firm's investment strategy [1]

Ares Management Conference Call Summary Company Overview - **Company**: Ares Management (NYSE: ARES) - **Assets Under Management**: Approximately $600 billion - **Core Expertise**: Credit, real assets, secondaries, and private equity - **2025 Performance**: Sustained industry-leading growth momentum with record fundraising, strong deployment, and investment performance [1][5][12] Key Industry Insights Private Credit Market - **Market Sentiment**: Investors are moving away from anxiety regarding private credit, supported by strong fundamentals [5][6] - **Portfolio Performance**: Ares credit portfolios are large, diversified, with non-accrual rates near historic lows; company-level cash flow growing at 10%-12% annually [7] - **Market Strength**: Deployment in Q4 is strong, with pipelines at or near record levels [7][12] Fundraising Dynamics - **2025 Fundraising**: On track for a record year, exceeding $90 billion, with strong demand from institutional and wealth channels [12][13] - **2026 Outlook**: Anticipated strong demand for private credit, with larger flagship funds expected to enter the market [14] Alternative Credit Opportunities - **ABF Strategies**: Ares focuses on both investment-grade (IG) and non-rated asset-backed finance (ABF), with non-rated strategies being more profitable [15][17] - **Market Position**: Ares has raised three of the four largest ABF funds, indicating strong market presence [16] Deployment and Market Activity - **Deployment Overview**: Q3 saw over $40 billion deployed; Q4 is expected to continue this momentum across various segments, including infrastructure and real estate credit [21][22] - **Market Segmentation**: Deployment is broad-based, indicating overall market health, with strong opportunities in asset-backed finance and opportunistic credit [22] Wealth Channel Growth - **Wealth AUM Target**: Increased target to $125 billion by 2028, with consistent quarterly inflows of about $4 billion [23][24] - **Product Evolution**: Introduction of new funds in core infrastructure and sports/media, with ongoing demand for geography-specific funds [25] Direct Lending Insights - **Advisor Demand**: Financial advisors are focusing on durable yield from various asset classes, not solely private credit [26][28] - **Market Dynamics**: Demand for private credit remains stable despite changing interest rates, driven by excess return generation [29] International Market Dynamics - **Distribution Landscape**: About 40% of wealth products come from outside the U.S., with a more fragmented and less concentrated market in Europe and Asia-Pacific [30][33] Strategic Partnerships and Growth - **Partnership Approach**: Ares is cautious about partnerships with traditional managers, focusing on delivering differentiated outcomes for clients [38][39] - **401(k) Market Potential**: Ares supports the inclusion of alternative assets in defined contribution plans but emphasizes the need for investor suitability and fiduciary duty considerations [40][42] Acquisition and Integration - **GCP Acquisition**: Integration is progressing well, with expectations for margin expansion as duplicative infrastructure costs decrease [47][48] - **Secondaries Market Growth**: Ares is expanding into infra secondaries, with significant growth expected in the coming years [49][51] Financial Outlook - **FRE Margin Guidance**: Expected margin expansion in 2026 due to successful fundraising and deployment [54][56] - **Capital Management Strategy**: Ares is considering various options for redeploying free cash flow, including dividends, buybacks, and investments in growth [59][61] Conclusion - Ares Management is positioned for continued growth in the alternative asset management space, with strong fundamentals in private credit, a robust fundraising outlook, and strategic expansion into new markets and product offerings.