Partners Group expects evergreen fund withdrawals to continue after June turmoil

By Ariane Luthi

ZURICH, July 16 (Reuters) - Partners Group beat expectations for new client demand in the first half, but warned withdrawals from some of its mature evergreen funds are likely to continue after it recently capped redemptions from an open-ended fund, hitting its shares.

Shares in the Swiss asset manager fell 7% in early trading on Thursday.

Partners Group reported after Wednesday's market close that net inflows were only modestly positive in the first half as client withdrawals totalled $3.8 billion, in line with forecasts. It said 79% of the outflows came from three mature evergreen strategies.

Evergreen funds, which do not have a fixed end date, accounted for 26% of the firm's new client commitments in the first six months of 2026.

Partners Group said it expects current redemption trends to continue for several quarters, which could slow growth in assets under management by 1% to 2% over the next 18 months.

Over the medium term, the company said outflows from these funds could reach $10 billion to $20 billion in a negative scenario, although it expects growth across its broader evergreen platform to offset the impact.

Net new money figures are likely to continue declining and the environment in the private equity sector remains challenging, said Maurizio Porfiri, chief investment officer of Maverix Securities. "Investors had hoped for an 'all-clear' message, but that certainly did not come."

NEW CLIENT DEMAND ABOVE EXPECTATIONS

Partners Group posted first-half inflows of $16 billion, bringing assets under management to $186 billion. Bank Vontobel analysts had forecast new client demand of $14.5 billion.

The company also confirmed its gross new client demand guidance of $26 billion to $32 billion for the full year.

"We are pleased to report record client demand as our differentiated offering and track record continues to attract new and existing clients," CEO David Layton said, while noting the investment environment remains complex.

"Within our portfolio, we see mostly solid performance, though with some challenges concentrated amongst select assets and vintages," he added.

Partners Group has pioneered popular alternative investments, but its shares are down by about a third this year, spurring a broad retreat in stocks of global asset managers while highlighting a growing mismatch in private markets.

When asked on a call with analysts about how the firm's dividend might be affected, Layton said it was targeting dividend stability and long-term growth.

"One note is that I do expect a debate in our next board meeting around share buyback versus dividend," he added.

Partners Group suffered its worst-ever drubbing in the stock market on June 3 on news it was capping withdrawals from an $8.6 billion private equity fund that saw clients demand their money back.

A day later, sources said the firm planned to gate an even bigger U.S. fund that also saw withdrawals accelerate, in part driven by fears that assets could be overvalued.

Three other mature evergreen funds, with a total of $9.7 billion in assets, anticipated redemptions of between 3.5% and 5%, the company said on June 4.

($1 = 0.8052 Swiss francs)

(Reporting by Ariane Luthi and Paolo Laudani. Additional reporting by Oliver Hirt. Editing by Dave Graham, Nia Williams and Mark Potter)