Blackstone is seeking to sell more than $2 billion in private investment fund stakes. The firm plans to structure the transaction as a collateralized fund obligation (CFO). This process bundles private equity stakes into bonds for sale to investors and insurers.
The deal aims to provide a cash infusion to investors in a Blackstone Strategic Partners fund. This specific fund specializes in secondary investments. The transaction represents one of the largest of its kind to date.
The move comes as the private equity sector struggles with an estimated $4 trillion in unsold assets. Firms currently face significant challenges in exiting investments and returning capital to limited partners. Blackstone may still opt for a traditional secondary sale instead of the securitization.