Ares Management Corp CEO Michael Arougheti details the growth of his company, which now surpasses established competitors such as Carlyle in terms of market capitalisation. This rise is mainly due to Ares' early entry into the private credit market, some 30 years ago, and its international expansion.
 
Arougheti highlights performance and sustained earnings growth as the main attractions for investors. He plays down concerns about credit quality in the private credit sector, citing a non-performance rate of just 0.6%, well below the historical industry average of around 3%.
 
Michael Arougheti points out that the private credit sector is strong, because companies borrow less than half of their total value. This means that for every euro lent, the company has at least two euros of value, which provides a margin of safety. What's more, business owners have invested a lot of their own money, which gives them an incentive to ensure that the business runs smoothly and repays its debts.

Bloomberg videos, provided by MT Newswires