Private Markets Grapple With Transparency & Disclosure Concerns Amid 401(k) Push | Weekly Pulse

Must Know: Transparency Crisis Emerges as Private Markets Seek 401(k) Access

Headline: Major private equity funds obscure valuation data while industry pushes for retirement account expansion

🎯 Bottom Line: Partners Group's $16 billion fund lists 1,095 cost figures in footnotes for only 1,089 investments, making markup analysis impossible, while payment deferrals in private credit hit four-year highs at 11.4% in Q2 2025.

📊 Why It Matters:

• Some funds report instant markups of 1,000%+ when buying secondary stakes at discounts then immediately revaluing to NAV

• Lincoln International's "bad" PIK rate now stands at 6% vs. 2% in 2021

• Private credit deployment volumes dropped 33-67% year-over-year amid tariff uncertainty

• Trump's executive order seeks 401(k) access despite transparency concerns

🌍 Big Picture: The private markets industry faces a credibility crisis as funds obscure performance data through complex disclosure practices while simultaneously seeking access to $7 trillion in American retirement savings, raising questions about investor protection and regulatory oversight.

Trends to Watch

🔮 Transparency Accountability - Partners Group promising to include investment costs in main disclosure tables after criticism over incomprehensible footnote practices

🚨 Private Credit Student Lending - New $20,000 annual federal loan limits creating massive opportunity as parents previously could borrow unlimited cost-of-attendance amounts

📈 Midlife Co-Investment Growth - Audax's $1.3 billion fund targeting late-stage deals as continuation vehicle alternative, addressing GP and LP liquidity needs

⚡ Clean Energy Transition Acceleration - Shortened tax credit timelines driving rush to begin construction within one year to qualify for incentives before 2027 phaseout

🏦 Fund Administration Modernization - Apollo-Motive Partners combination addressing institutional demands for streamlined private markets service delivery and transparency

💻 Software Sector Resilience - JMI Equity's rapid $3.1 billion raise demonstrating continued appetite despite broader market headwinds and deployment challenges

🔧 Industrial Carve-Out Demand - Pacific Avenue Capital's $1.65 billion raise (tripling predecessor) highlighting opportunities in operational turnarounds and corporate separations

⚠️ Regulatory Scrutiny Intensifying - Trump's 401(k) executive order facing implementation challenges as funds obscure performance data through complex disclosure practices

🌐 Market Structure Evolution - Secondary market volume surge of 51% creating talent shortages and forcing firms to implement restrictive employment agreements

🎯 Specialized Lending Expansion - Firms diversifying beyond traditional corporate lending into aviation, sports financing, and student lending to maintain deployment levels

Deal Spotlight: Transactions & Strategies

🤝 Audax-Midlife Co-investments - $1.3 billion inaugural fund for late-stage private equity deals, marketed as alternative to continuation funds with Audax providing 20% of commitments

🏭 Pacific Avenue Capital - $1.65 billion latest fund for corporate carve-outs and operational challenges, tripling amount raised versus predecessor pool for Los Angeles-based firm

⚡ Hubbell-DMC Power - $825 million acquisition from Golden Gate Capital for high-voltage power infrastructure connector technology with $130 million expected 2026 revenue

🌱 Apollo-Motive Partners - New private-markets servicer combining Alchelyst and Apollo's Lyra Client Solutions to streamline fund manager-investor interactions

💻 Centerbridge-MeridianLink - $2 billion acquisition at $20 per share, 26% premium, for financial software platforms provider with $1.4 billion private debt package

💽 Advent-Sapiens - $2.5 billion acquisition of Israeli insurance software provider backed by nearly $1 billion private debt deal led by Blackstone and Goldman Sachs Asset Management

🚀 Thoma Bravo-Olo - $2 billion acquisition of hospitality software company at $10.25 per share, seeking $600 million private credit financing post-announcement

🛠️ KKR-Flexera Software - $3 billion private credit package to refinance existing debt and pay dividend to Thoma Bravo, adding almost $1 billion to capital structure

🚗 Apollo-ABC Technologies - Reviving $2+ billion debt sale for Canadian auto parts buyout that got stuck on bank balance sheets during April tariff selloff

⚽ Nottingham Forest Transfer - £28 million loan at 8.2% from Macquarie backed by future Brennan Johnson transfer fees to Tottenham, highlighting sports financing innovation

Fundraising Focus: Capital Formation

🎯 Audax Strategic Capital - $1.3 billion inaugural midlife co-investment fund targeting late-stage private equity deals as alternative to continuation vehicles, with Audax providing 20% of commitments exceeding target

🖥️ JMI Equity Fund XII - $3.1 billion raised in under six months for software deals, 29% increase over $2.4 billion predecessor fund with almost all previous investors participating in the Washington D.C. firm's first fund since leadership transition

🏭 Pacific Avenue Capital - $1.65 billion latest fund for corporate carve-outs and operational challenges in mission-critical industries, tripling amount raised versus predecessor pool for Los Angeles-based firm founded in 2018

🔄 Coller Credit Opportunities II - $6.8 billion raised in June for credit platform expansion by UK-based secondary market investor, demonstrating continued LP appetite for alternatives

🏦 Goldman-Millennium - Offering $1M minimum stakes in $78 billion hedge fund at $14 billion valuation through Petershill platform targeting high-net-worth individuals with 1% management fee and 10% carry

🇬🇧 Betashares Australia - Launching unlisted fund structure for individual investors to access US private credit loans, expanding retail access to alternative investments

✈️ Castlelake Merit AirFinance - $1.8 billion aviation lending platform debut targeting airlines and leasing companies as traditional bank lenders retreat from sector

🎮 Coller-TPG Twin Brook - $3 billion continuation fund transferring 2016 and 2018 vintage loans to new structure, marking largest private credit secondaries vehicle to date for middle-market direct lending

🔄 Accel-KKR isolved - $1.9 billion second continuation vehicle for HR software firm acquired in 2011, generating 19.2x gross multiple on investment over 14-year hold period