Source: Alternatives Watch

Clearlake Capital Group is furthering its private markets muscle with the acquisition of Pathway Capital Management.

For Clearlake, which manages about $90 billion, the acquisition adds Pathway’s $95 billion platform spanning private equity, private credit, and liquid strategies. The addition will take Clearlake’s total private markets assets to roughly $185 billion. Pathway will operate as Clearlake’s investment solutions business.

“This partnership is designed to drive performance and deliver enhanced outcomes for clients across market cycles,” said José E. Feliciano and Behdad Eghbali, co-founders and managing partners at Clearlake. “Pathway’s long-standing track record and global reach complement our platform, and together we can offer broader access, deeper insights, and more tailored solutions — helping investors achieve better outcomes in an increasingly complex alternatives landscape.”

Strategic expansion

Founded in 1991, Pathway’s expertise spans private equity, private credit, infrastructure, secondaries, and co-investments, offered as bespoke private market strategies or through multi-investor funds.

For Clearlake, the new business combination will boost its private credit origination capabilities, while expanding the scope of its private market capabilities and broadening distribution across institutional and private wealth channels. Pathway will retain its brand and operate independently as Clearlake’s investment solutions business, expanding Clearlake’s footprint into the institutional and private wealth market.

Most recently, Pathway opened a new office in Munich, Germany, through an affiliate, PCM Germany. Jérôme Simon, vice president at Pathway was tapped to head up the office last month with a focus on supporting institutional clients and delivering private market solutions across the region.

Pathway’s leadership team will remain intact and continue to operate the business with James Chambliss, Richard Mazer, and Alex Casbolt leading the Pathway team. Upon closing, Clearlake’s global team will total approximately 500 employees.

According to Chambliss, Mazer and Casbolt, the deal is the culmination of more than a decade of investing with the Clearlake team, and they look forward to bringing their solutions to an even broader client base.

Over the past year and a half, Pathway Strategic Credit Fund III saw institutional investor uptake. Recent commitments were made by Tennessee Consolidated Retirement System and Oregon State Investment Council.

Last month, Pathway announced it had closed on a $250 million custom direct equity mandate for an insurance provider.  The fund will make direct equity investments alongside private equity managers active in a variety of investment strategies, industries, and regions.

Another $200 million customized fund of funds mandate closed in October for an Asia-based institutional investor. The allocator was not disclosed, but the fund was set to focus on primary fund investments and co-investments in both the small and middle markets globally.

In private wealth, the team closed in September on a $525 million private equity fund for wealth investors. The fund is focused on secondaries (both LP-led and GP-led), as well as on co-investments with an emphasis on small- and middle-market investments.

As for Clearlake, officials last month raised an undisclosed sum for Constant Contact, a digital marketing software provider for small businesses and nonprofits, via Icon Partners VI. The single-asset continuation vehicle was established with funding from institutional investors led by Lexington Partners as well as existing investors. Prior to that, the team took part in a $100 million capital infusion for ModMed, a specialty-specific SaaS provider for ambulatory medical practices, alongside CPP Investments.

Advisors

Terms of the transaction have not been disclosed, and closing is expected in the first quarter of 2026, subject to the receipt of required regulatory approvals and other customary closing conditions.

Evercore and BofA Securities served as financial advisors to Clearlake, and Kirkland & Ellis served as legal advisor. UBS Investment Bank served as financial advisor to Pathway, and O’Melveny & Myers provided legal counsel.