Welcome back. As armed conflict has accelerated in the Middle East over the weekend, we are thinking of our readers in that part of the world and hope that you all remain safe.

In this morning's newsletter, concerns about artificial intelligence and risky lending, which have been depressing the share prices of alternative-asset managers, seized new victims in the stock market—banks—the Journal’s Ben Glickman reports.

Also, WSJ Pro's Laura Kreutzer writes exclusively that growth focused private equity firm Bregal Sagemount has hit the $3.5 billion upper limit for its latest private equity fund, surpassing the fund's cap. 

We have those stories and other news below. Please, read on...

A chorus of concerns about AI and risky lending has bank investors spooked, Ben Glickman writes for The Wall Street Journal. Shares in big lenders and investment banks sold off sharply Friday after new credit issues emerged and fears of broader economic implications from artificial intelligence weighed on investors. Wobbling confidence in private-credit lenders has further jolted the financial sector. Investors have reacted sharply to other signs that more losses could be coming and got a fresh example last week in the collapse of U.K. property lender Market Financial Solutions. The lender's investment vehicles were funded by at least half a dozen global banks and asset managers.

Bregal Sagemount is wrapping up its fifth growth buyout investment fund after reaching its $3.5 billion upper limit for the vehicle, the firm’s largest so far, WSJ Pro’s Laura Kreutzer writes. The $3.5 billion doesn’t include the firm’s own general-partner commitment, which will push the total fund size even higher. The new fund surpassed not only its $3 billion target but also the size of its $2.65 billion predecessor.

RedBird Capital Partners and Apollo Global Management are supporting Paramount Skydance's acquisition of Warner Bros. Discovery, with RedBird providing some of the $47 billion in equity and Apollo backing part of the $54 billion of debt required for the deal. RedBird Advisors, along with Centerview Partners, is also acting as a lead financial adviser to Paramount.

Real assets investment firm Stonepeak is investing in Aura Holdings, a retirement village developer and operator based in Queensland, Australia. The firm’s investment consists of up to 1 billion Australian dollars, or around $709 million, to support Aura, which has completed six retirement villages with nearly 800 units with six more in the near term pipeline and more than 10 in early development.

Advent International is considering a possible takeover of British manufacturing and engineering-services company Senior, Nina Kienle reports for the Journal. Senior said Friday that it had drawn interest from multiple parties for a takeover of its business, receiving two superior all-cash proposals, after appointing Lazard and Jefferies to initiate discussions. Senior shares jumped almost 20% in London Friday on the disclosures.

Existing backer SoftBank Group is putting another $30 billion into ChatGPT maker OpenAI, joining a $110 billion growth investment that also includes strategic investors Amazon.com and Nvidia, which are chipping in $50 billion and $30 billion, respectively, Kate Clark reports for the Journal. The new investments came at a pre-money valuation of $730 billion. SoftBank wrapped up an earlier commitment of $40 billion alongside co-investors in December, saying at the time it owned about 11% of the artificial-intelligence business. The Tokyo firm invested last year through its SoftBank Vision Fund 2.

Searchlight Capital Partners and Abry Partners have agreed to acquire outstanding shares that they don’t already own of KORE Group Holdings in a roughly $726 million transaction. Atlanta-based KORE provides connectivity, technology and services supporting the Internet of Things, or IoT. Abry currently owns around 28% of the company’s issued and outstanding common shares, while Searchlight holds preferred stock and also holds warrants to purchase around 14% of the company’s common stock on a fully diluted basis.

Our add-on deal interactive tool allows you to sort and analyze volumes of add-on deal data compiled by WSJ Pro. View more.

Partners Group in Switzerland is selling Nordic data-center operation atNorth to the Canada Pension Plan Investment Board and strategic buyer Equinix at an enterprise value of about $4 billion, Aimee Look reports for the Journal. Partners said the investment generated a return of 2.5 times its capital investment, which began in 2022. The Iceland-based business, which now has eight operating data centers and more under development, produced compounded annual returns of over 30%, Partners said. CPP Investments will own a roughly 60% interest, with a $1.6 billion investment. The buyers have arranged $4.2 billion in financing to back their investment, while Partners committed to reinvesting to acquire a 10% stake following the transaction..

Nashville, Tenn.-based Seven Hills Capital has wrapped up its second fund at the fund’s $235 million upper limit. The final tally for Seven Hills Capital Fund II is nearly double the $125 million that the firm raised for its debut offering in 2023. Pacenote Capital placed both the latest fund and the debut fund.

Blackstone's Steve Schwarzman collected more than $1.2 billion in dividends and compensation in 2025, the Journal reports, citing the firm's annual filing. The haul, which was in line with the chief executive's previous record in 2022, came despite lackluster performance for the firm's shares. Including dividends, the stock lost 7.9% last year, compared with a 17.9% total return for the S&P 500. As in previous years, the vast majority of Schwarzman's take, around $1.1 billion, came from dividends on his roughly 20% stake in Blackstone.

Hamilton Lane has appointed Mike Tashiro to the newly created role of head of private wealth solutions in Japan. Tashiro joins from MSCI, where she worked in index sales covering major asset management firms and building the firm’s wealth management business.

Bain Capital has hired Matthew Bryant as a senior member of its European insurance team, sister publication Private Equity News reports, citing people familiar with the situation. The 42-year-old London-based investor will be returning to the Boston buyout giant, where he worked for roughly a decade up until 2019, to focus on deals across the sector. He most recently served on the financial services team at CVC Capital Partners.

The market for private-credit assets backing midsize businesses "remains defensive and underappreciated," analysts with the investments arm of New York Life Insurance Co. said in a report issued last week. Nonbank lenders accounted for more than twice as much midmarket debt issued last year than the broadly syndicated loans used by banks, the analysts said. While spreads are tightening and yields declining, the sector continues to appeal to investors because of its cash flow, underwriting discipline and borrower-lender relationships, they said.

Blackstone's listed private-equity investment vehicle, BXPE, and parallel pools reported a transactional net asset value of about $19.2 billion at the end of January, more than double the total at the same point last year, securities filings show. The Blackstone Private Equity Strategies Fund program, one of the firm's perpetual strategies, collected an additional $831.9 million on Feb. 1, a filing on Friday showed. The amount added in February was almost 28% more than the sum brought in in the same month last year. Blackstone set up BXPE and began marketing it to wealthy individuals at the start of 2024.

A nonbank lender affiliated with giant asset manager BlackRock joined a growing number of business development companies on Friday detailed its shrinking net assets and rising writedowns from increases in nonperforming loans, and cut its shareholder dividend. BlackRock TCP Capital's nonaccrual loans grew to 4% of its assets at the end of December from 3.5% at the end of September, while net asset value fell 23% to $7.07 a share from a year earlier to $598 million, according to a securities filing. At the end of 2024, its nonaccrual assets accounted for 5.6% of its holdings. The BDC said just six companies represented nearly two-thirds of the decline in NAV out of the 141 businesses represented in the BDC's holdings. In all, the lender held assets tied to 14 companies on a nonaccrual basis. Payment in kind, or noncash, income rose to 10.9% of total investment income from 9.5% at the end of September, according to Erik Cueller, chief financial officer. The BDC cut its dividend to 17 cents a share from 25 cents. Its Nasdaq-listed stock fell 9.3% Friday.

Apollo Global Management-affiliated business development company MidCap Financial Investment's net assets fell 6.9% from a year ago to about $1.31 billion, or $14.18 a share, at the end of December, a securities filing last week showed. Fourth quarter net investment income slipped 2.9% to about $36 million, or 39 cents a share, at the end of last year. Speaking with analysts Friday, Tanner Powell, the BDC's chief executive, said it had been buying back shares at significant discounts to net asset value during the fourth quarter, and plans to do more this year with an additional $100 million for repurchases. MidCap said buyback discounts averaged 18%. The BDC said that the decline in NAV stemmed primarily from a handful of investments predominantly made in 2022 and earlier, and said it had moved assets from three companies into nonperforming status while moving two others out of that category during the fourth quarter. The three moved to nonaccrual status accounted for over a third of the BDC's net loss for the fourth quarter. The company cut its dividend to 31 cents a share from 38 cents. Its Nasdaq-listed shares fell 8.1% Friday.

A blank check company led by Fortress Investments Co-Chief Executive Andrew McKnight, Fortress Value Acquisition Corp. V, has raised $250 million through an initial public offering of shares priced at $10 each. The special-purpose acquisition company, or SPAC, aims to draw on Fortress Investments expertise to identify potential candidates to acquire and bring public, according to a securities filing. Law firm Ropes & Gray advised on the IPO.

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