Most Private Equity Investors Fear Cash Is Stuck in Zombie Funds

Investors in private equity see a rising number of “zombie funds” tying up their money, according to a survey by secondaries asset manager Coller Capital.

Almost 50% of pension funds, insurers or other investors already have money in funds that have little hope of liquidating their assets or raising a successor vehicle, while 28% expect to see such funds appear in their portfolio, the survey found.

“Recent years, marked by inflation and high interest rates, have no doubt had an unfavorable impact on portfolio companies’ growth prospects, which could lead to an increase of zombie funds,” the report said.

Coller ...