Blackstone Snaps Up Discounted Stakes In $1.3 Billion Private Equity Portfolio

Blackstone Strategic Partners has reportedly expanded its secondaries business, acquiring a portion of a $1.3 billion portfolio of private equity co-investments at a roughly 20% discount to net asset value.

The secondary arm of hedge-fund giant Blackstone (NYSE:BK) purchased part of the portfolio, which included 22 positions linked to major private equity firms such as Carlyle Group (NASDAQ:CG), CVC, KKR (NYSE:KKR), Blackstone, and Insight Partners, people familiar with the transaction told PitchBook. The seller retained the remaining positions.

Blackstone had explored forming a buyer group with limited partners but ultimately completed the acquisition without their participation. The seller has not been identified.

KKR accounted for the largest share of the original portfolio, representing about 18.5% of its net asset value. Several holdings were co-investments alongside KKR, including Environmental Resources Management, Groundworks and Optiv. The portfolio also included Blackstone’s investment in Advarra.

The transaction comes as private-equity secondaries reach record levels, with buyers seeking discounted exposure to existing investments and sellers looking for liquidity.

Evercore estimated that secondary transaction volume reached $121 billion in the first half of 2026, with more than half coming from GP-led transactions. Single-asset continuation vehicles accounted for roughly $34 billion, or 53%, of GP-led activity.

Secondaries observers expect full-year deal value to exceed $250 billion, more than double the total recorded in 2023, Blackstone President Jonathan Gray said during a conference presentation earlier this year.

S&P Global Market Intelligence recently reported that growth in private equity secondaries is expected to "outlast the investor liquidity squeeze," suggesting the market’s expansion could continue even as investors face pressure to generate cash from illiquid holdings.

The market’s growth also reflects the appeal of discounted entry points, although co-investments can present additional hurdles when ownership changes hands.

Unlike traditional fund stakes, co-investments can involve side agreements that determine investors’ economic rights, making transfers more complicated.

The purchase also comes as Blackstone continues to build its secondaries business. According to PitchBook, the firm is raising its 10th flagship secondaries fund, which has secured $12.3 billion in commitments so far.

Secondary transactions allow investors to sell existing private-market positions before the underlying investments are fully realized. Buyers gain exposure to established portfolios, often at discounts to reported net asset values, while sellers can generate liquidity without waiting for exits.

Blackstone’s deal highlights growing demand for discounted private equity stakes as investors seek liquidity and buyers look for attractive entry points into private markets.

Photo: Shutterstock