The private equity deal market has been on a slowdown in recent months, as investors have become more cautious about making new investments. This has led some private equity firms to get creative about how they raise cash.
One way that private equity firms are raising cash is by selling assets. This can include selling portfolio companies, selling stakes in funds, or selling debt. For example, Carlyle Group recently sold a stake in its credit arm for $2.2 billion.
Another way that private equity firms are raising cash is by issuing debt. This can be done through traditional debt markets, such as issuing bonds, or through more creative channels, such as securitizing assets. For example, Apollo Global Management recently issued a $1 billion securitized loan backed by a portfolio of credit assets.
Private equity firms are also raising cash by tapping their limited partners (LPs). LPs are the investors who provide capital to private equity funds. In recent months, some LPs have been willing to provide additional capital to their funds, even though the deal market is slow. This is because LPs are still seeing the potential for long-term growth in the private equity industry.
The slowdown in the private equity deal market is likely to continue for some time. However, the creative ways that private equity firms are raising cash will help them to weather the storm and continue to invest in businesses.
