Blackstone sinks after $1.7 bln net outflows from flagship private credit fund

Investing.com-- Blackstone Inc’s (NYSE: BX) flagship private credit fund saw $1.7 billion in net outflows in the first quarter amid growing investor uncertainty towards the asset class, a securities filing showed, sending shares down over 8% in early trading Tuesday.

Investors in the Blackstone Private Credit fund requested a 7.9% withdrawal of their holdings in the first quarter, higher than their usual rate of 5%, Blackstone said in a filing.

This resulted in a payout of $3.7 billion, based on the fund’s current valuation of $82 billion. The payout was also higher than the $2 billion in new commitments made to the fund, resulting in a net outflow of $1.7 billion.

Blackstone said it paid out the redemptions in full.

The redemptions come amid growing investor scrutiny of private credit, especially after a series of high-profile writedowns and overhauls in the industry over the past two months.

Investment group Blue Owl was at the centre of this anxiety after it halted redemptions at a major private fund.

"BCRED saw redemption requests of 7.9%, which the company met in its entirety, but this was above investor expectations based on our conversations," Barclays analyst Benjamin Budish said in a note to clients, and expects the news to weigh on shares across the alternative asset managers today.

Elsewhere, Apollo Global is down 6%, while Carlyle Group and KKR & Co are both down 5%. TPG is faring the best among the group, but is still down 4%.

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