Arnaud Giblat

Arnaud Giblat inquired about the BXP (Blackstone Private Equity Strategies Fund), asking how the firm thinks about the product's ultimate size, its capacity to deploy capital, and potential vintage diversification relative to flagship funds.

Answer

President & COO Jonathan Gray stated that Blackstone's greatest strength is its capacity to deploy capital effectively. He explained that BXP was designed with the widest possible investment aperture—spanning geographies and strategies from control private equity to opportunistic credit—to accommodate regular inflows. By limiting the fund to qualified purchasers, Blackstone ensured maximum flexibility. Gray expressed high confidence in the firm's ability to find sufficient opportunities to serve both BXP and its institutional clients without compromising performance, citing the firm's proven ability to scale platforms.

Arnaud Giblat inquired about the five-year outlook for Blackstone's perpetual products, specifically how distribution might evolve and the level of investment required to support that growth.

Answer

Jonathan Gray, President & COO, expressed significant optimism, predicting the business could be "far larger" in five years. He noted that Blackstone has already made an "enormous investment" in its private wealth platform, with over 300 dedicated personnel globally. He believes the power of the Blackstone brand is a key differentiator that enables capital-light expansion, seeing a massive opportunity as private wealth allocation to alternatives (currently ~1%) moves closer to institutional levels (~30%).

Arnaud Giblat of BNP Paribas requested more details on the €50 billion KKR-ECP joint venture, asking about the deployment mechanism, the capital split between partners, and the expected timing.

Answer

Craig Larson, Partner & Head of IR, and Scott Nuttall, Co-CEO, clarified the partnership's goal is to be a 'one-stop shop' for hyperscalers, providing creative solutions across construction, real estate, and energy. Larson stated the partnership is roughly 50/50, with KKR's capital coming from existing funds and strategies, and there is no specific investment timeline. Nuttall added that there is an ability to raise incremental capital for new projects as they arise.

Arnaud Giblat from BNP Paribas inquired about the evolving availability of bank debt for large deals and whether KKR's private debt business sees an opportunity to regain market share from banks.

Answer

CFO Rob Lewin acknowledged a brief dislocation in early April but stated the leveraged finance market is now open, though at wider spreads. Co-CEO Scott Nuttall added that capital is available, with different financing routes chosen based on the deal's complexity. He sees the syndicated and private credit markets co-existing, with private credit poised to gain share whenever increased volatility causes banks to pull back.

Arnaud Giblat asked how the economics from the Intersect Power and Google opportunity are captured by TPG and questioned whether the gap between total AUM and fee-earning AUM is due to timing or to no-fee co-investments.

Answer

Executive Chairman Jim Coulter clarified that the Intersect investment is held at the fund level, with growth potential from continued investment into the company. CFO Jack Weingart explained that no-fee, no-carry co-investments are a regular and important part of the business to serve LPs, and that this accounted for some of the gap in Q4, particularly in the credit and capital platforms.