KKR overtakes Partners Group as Europe’s largest evergreen manager

KKR has overtaken Partners Group to become Europe’s largest manager of open-ended private market funds by assets, as the US private equity firm expands its wealth-management business while its Swiss rival contends with elevated investor withdrawals, according to a report by Bloomberg.

KKR had €13.6bn ($15.6bn) across its European-domiciled evergreen platforms at the end of the first quarter, compared with €13.4bn for Partners Group, according to data from industry research firm Novantigo cited by KKR.

Markus Egloff, KKR managing director and head of global wealth solutions international, said the firm had recently become the leading European evergreen manager, highlighting the rapid expansion of its private-wealth business.

KKR launched its first European-domiciled evergreen vehicle for wealth investors in May 2023 and has since expanded its presence in Switzerland, where alternative asset managers have established operations to build relationships with private banks and gain access to wealthy individual investors.

The growth of evergreen private-market funds reflects efforts by private equity firms to broaden their investor bases beyond traditional institutions. With institutional allocations to private markets facing constraints in some markets, asset managers have increasingly targeted high-net-worth and retail investors through semi-liquid structures.

The expansion has also exposed managers to a different set of liquidity challenges. Private credit and other evergreen vehicles have faced increased redemption requests this year amid concerns around credit quality and the potential impact of artificial intelligence on software businesses held by private equity investors.

Partners Group has been particularly affected by the withdrawal pressure. The Swiss-listed private equity firm imposed a redemption limit on its flagship $14.5bn evergreen fund after a surge in investor requests.

The move has highlighted the liquidity challenges inherent in open-ended private-market structures, which offer investors more frequent exit opportunities than traditional closed-end private equity funds while investing in comparatively illiquid assets.

KKR has also faced redemption pressure in some of its private credit vehicles, although the firm has said demand has subsequently moderated after withdrawal requests reached applicable limits.