Happy holiday hump day, !

This week we dive into the growing force of Family Offices in the global wealth management landscape.

2025 will bring a liquidity crunch to private equity, driven by the looming maturity of $298B in LBO loans.

Private Credit boom states a 15% CAGR over the past ten years, proving to be an evolving risk-reward balance instrument.

Evidently driven by AI's insatiable need for infrastructure, Data Centers construction spending is now forecasted to be at $49B by 2030.

— PE150 Team

In this Issue:

• Data Dive

• Trend of the Week

• Liquidity Corner

• Deal of the Week

• Private Credit Corner

• Macro View

• Vendor Value Creation

• This Week in History

• Interesting Articles

• Tweet of the Week

📚 Data Dive

Monthly Edition: PE’s New “Patient Capital” Powerhouse

The family office market keeps growing—and so is its appetite for Private Equity. With $5.5 trillion in wealth and set to reach $9.5 trillion by 2030, family offices have quietly become the ultimate long-term investors. Roughly 19% of their portfolios are now in PE, drawn to its mix of control, growth, and strategic returns. Why? They can afford to think in decades, not quarters, while funds scramble to show annual exits. Unlike traditional LPs, family offices bring flexibility and a willingness to take on illiquidity for outsized rewards. The trend is global, with North America leading, but Europe and Asia are quickly catching up. For PE sponsors, this means more than capital—it’s aligned, stable, and deeply patient. If you’re not talking to a family office yet, someone else is. And they’re likely sealing the deal.

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📈 Trend of the week

AI Is Eating Capacity—And PE Is Footing the Bill

Data center construction is surging globally, with spending projected to hit $49B by 2030. What’s driving it? Artificial intelligence's insatiable need for computational power has outstripped current infrastructure. Hyperscalers and co-location companies are pouring billions into building data centers—but capital-intensive projects require hefty upfront investments and mid-to-long-term ROI. Enter private equity sponsors. PE firms are uniquely positioned to provide growth capital for data center developers, drawn to the sector’s stable, high-demand fundamentals and a CAGR flirting with 6%. As AI accelerates, those data centers—and the PE players behind them—are becoming indispensable.

💰 Liquidity Corner

2025 - A year of pressure for Private Equities

The growing maturity wall of $298 billion in leveraged buyout (LBO) loans by the end of 2025 underscores an urgent liquidity challenge for private equity (PE) firms, particularly as traditional refinancing options become constrained. With high interest rates and stagnant exit channels, GPs face the dual pressure of improving portfolio company EBITDA to offset rising debt costs while devising creative solutions to bridge liquidity gaps. Unlike during the Global Financial Crisis (GFC), where GPs could buy back debt at deep discounts, today’s economic conditions—marked by elevated borrowing costs and fewer distressed opportunities—demand alternative approaches to ensure portfolio stability and avoid value erosion.

To address this liquidity squeeze, proactive GPs are turning to innovative strategies such as NAV loans, equity infusions, and continuation vehicles. NAV loans, which borrow against the portfolio rather than individual companies, offer immediate relief but risk creating a drag on fund performance. For firms with untapped equity, injecting capital to make debt manageable can buy time but requires balancing dilution concerns. Additionally, continuation vehicles allow GPs to refinance single assets and reset cap tables while giving LPs the flexibility to roll their investments. In an environment where exit stress is mounting, these liquidity solutions are no longer optional—they are imperative for preserving portfolio value, maintaining investor confidence, and positioning assets for future recovery.

🤝 Deal of the Week

PE Goes Deep: Ares, Arctos Score NFL Stakes

Private equity just breached the NFL’s fortress: Ares Management took a 10% minority stake in the Miami Dolphins at an eye-popping $8.1B valuation, while Arctos led a group acquiring equity in the Buffalo Bills. Long excluded from NFL team ownership, PE firms now have a clear path after rule changes in August—though the league capped investments at 10%. For Ares, the Dolphins deal includes slices of Hard Rock Stadium and F1’s Miami Grand Prix, sweetening the pot. As NFL team values soar—averaging $5.9B—these minority stakes provide a playbook for Wall Street: stable, lucrative returns in a recession-resistant league. Translation: PE just found its favorite new trophy asset.

🏦 Private Credit Corner

Private Credit Market Size and Regional Analysis

The private credit market has surged to $2.1 trillion in 2023, marking a significant leap from $1.84 trillion in 2022. This growth represents a 15% compound annual growth rate (CAGR) over the past decade, driven by demand for alternative financing options that offer flexible structures and attractive yields. North America remains the largest regional market, reaching $1.25 trillion in 2023—roughly 60% of the global total—while European private credit stands at $0.27 trillion, showing a 17% CAGR. The sector's “dry powder” reserves, or undeployed capital, have also grown to $0.49 trillion, reflecting investors’ readiness to seize new opportunities amid rising interest rates and tightening liquidity.

The private credit landscape showcases an evolving risk-reward balance, particularly when comparing average annual credit losses of 0.9% to those of other credit instruments like high-yield bonds (1.47%). Within this market, secured loans dominate deal types, accounting for 55.8% of transactions across various sectors, including software and healthcare. Meanwhile, fund investments remain largely segmented, with public pension funds contributing 19% of total commitments, leaving 35% of sources unidentified. Lastly, annual default rates for sponsored and non-sponsored leveraged loans have declined to 2.3% and 7.8%, respectively, underscoring improved performance in recent years.

📊 Macro View

ECB to Markets: “We’re Cutting, Not Running”

The ECB just trimmed interest rates by a quarter-point to 3% and dropped its hawkish vibes. Eurozone growth forecasts look softer than overcooked pasta: 1.1% in 2025 (down from 1.3%) and 1.3% by 2027. Inflation? They’re seeing a neat 2% target — mostly. Markets aren’t buying a one-and-done; traders expect five more cuts by next September, dropping rates to 1.75%. The Fed might be less aggressive, but with Trump’s tariff threats hanging like a summer storm cloud, Europe’s export economy is looking increasingly vulnerable. “Gradual easing” is the new mantra — unless, of course, things get worse.

💼 Value Creation Corner

CVC’s ESG boost of a Polish convenience store chain

When British private equity fund CVC acquired Żabka, Poland's largest convenience store chain, in 2017, the business faced significant challenges, including high franchisee churn that disrupted operations and dampened customer satisfaction. CVC saw an opportunity to create value by embedding Environmental, Social, and Governance (ESG) principles into the company’s strategy. Key initiatives included replacing refrigerants across 2,200 stores, reducing plastic packaging, and increasing sales of plant-based products. Żabka became a sustainability leader by introducing 100% recycled plastic bottles in its branded beverages and launching Poland's first all-green energy store featuring innovations like kinetic floors and solar-absorbing window technology.

The results were transformative. CVC’s ESG-driven improvements significantly reduced franchisee churn, boosted employee engagement, and enhanced customer satisfaction. Over three years, Żabka achieved a 20% increase in aggregate sales growth, improved gross margins by 3.9 percentage points, and expanded its network to 7,000 stores and 6,000 franchises. Recognized as the ‘Green Portfolio Company of the Year’ in 2020, Żabka’s commitment to sustainability has also strengthened its recruitment and talent retention efforts, showcasing how active ESG value creation can deliver oversized returns and long-term business success.

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🏆 This Week in History

This Week in History: Enron Files for Bankruptcy

In December 2001, Enron, once celebrated as America’s “Most Innovative Company,” filed for bankruptcy in what was then the largest corporate collapse in U.S. history. The Houston-based energy giant, which boasted revenues over $100 billion, unraveled in a shocking wave of accounting fraud and executive misconduct. Enron’s deceptive practices—hiding debts, manipulating earnings, and misleading investors—caused its stock price to plummet from $90 to mere cents in months. Thousands of employees lost their jobs and life savings, while shareholders, pension funds, and even auditing giant Arthur Andersen, which was complicit in the scandal, were left in financial ruin. The fallout rippled through energy markets, financial institutions, and corporate boardrooms across the country.

In the aftermath, Congress launched extensive bipartisan investigations into the scandal’s root causes, exposing the role of deceptive accounting schemes, lax regulatory oversight, and unchecked corporate greed. The inquiries led to the landmark Sarbanes-Oxley Act of 2002, imposing strict corporate accountability measures and bolstering protections for investors. The Enron collapse remains a cautionary tale of how corporate misconduct can shake public trust, reshape financial regulations, and serve as a stark reminder of the importance of transparency and ethical leadership in corporate America.

📰 Interesting Articles

🐣 Tweet of the week

"Success consists of going from failure to failure without loss of enthusiasm"

Winston Churchill