Apollo private credit fund redemption requests ease in third quarter

In the third quarter, Apollo Global Management's private credit fund, Apollo Debt Solutions BDC (ADS), experienced a decrease in redemption requests by 2.1 percentage points, according to a regulatory filing. With approximately 14.7% of shares sought for withdrawal, the fund is set to repurchase 5% of shares, the usual limit. The majority of these requests were from investors resubmitting unfulfilled requests from earlier quarters.

While demand for liquidity in private credit funds surged this year due to concerns over lending standards and AI disruption risks, recent redemption pressure has begun to ease as asset managers tackle a backlog of unmet withdrawals and sentiment improves. BlackRock also reported a decline in redemption requests for its private credit funds this month.

By the end of the quarter, investors in ADS would have received an estimated 75% of their requested capital. The fund has garnered $0.2 billion in gross subscriptions up to September 1, with expected quarterly net outflows of around $0.5 billion, or 3% of its net asset value. Since its inception, ADS' Class I shares have provided a net total return of 8.2%, surpassing leveraged loan and high-yield markets by 177 and 377 basis points, respectively. Data on major vehicles managed by Ares and Blue Owl is anticipated in the coming weeks.