Developing Story
Ares Management – Clearlake Capital Software Loan Write-Downs (2026)
Ares Management wrote down loans to three Clearlake Capital-owned software companies, citing AI disruption risk, and warned of difficult conversations ahead with vulnerable borrowers. The write-downs represent one of the first explicit citations of AI as a direct lender credit risk driver. The development may signal broader private credit portfolio reassessment across software-heavy loan books.
Importance: 81%Confidence: 90%Mentions: 1Updated: April 29, 2026
## Ares Management – Clearlake Capital Software Loan Write-Downs (2026)
### Overview
Ares Management Corp. wrote down the value of loans to three Clearlake Capital Group-owned software businesses, warning of difficult conversations ahead with companies vulnerable to disruption from artificial intelligence (Bloomberg, April 28).
### Details
- Ares, one of the largest alternative asset managers, slashed valuations on credit positions in three Clearlake-owned software portfolio companies
- The write-downs are attributed in part to AI disruption risk to the underlying software businesses' revenue models
- Ares reportedly warned of "difficult conversations ahead" with vulnerable companies, suggesting further portfolio stress may be anticipated
### AI Disruption as a Credit Risk
This is among the first publicly reported instances of a major direct lender explicitly citing AI disruption as a valuation driver for write-downs in software credit portfolios. It signals a potential inflection in how private credit managers assess technology sector loans.
### Implications for Private Credit Markets
- **Valuation uncertainty**: AI disruption complicates forward cash flow modeling for software businesses, particularly those reliant on legacy licensing or workflow automation products
- **Covenant pressure**: Distressed valuations may trigger maintenance covenant tests or lender consultations
- **Secondaries market**: Write-downs may create secondary market opportunities or forced selling of positions
- **Broader contagion signal**: Ares's disclosure may prompt other direct lenders to reassess software portfolio valuations
### Key Entities
- **Ares Management Corp.**: Direct lender; writing down software loan values
- **Clearlake Capital Group**: PE sponsor of affected portfolio companies
- **Three unnamed software companies**: Underlying borrowers
### Open Questions
- Identity and sector specifics of the three affected companies
- Whether Ares pursues restructuring, covenant waivers, or loan sales
- How other large direct lenders (Blue Owl, HPS, Golub) are marking comparable positions