Senior executives in the alternatives management sector are defending secondaries valuation practices following public criticism from industry peers. The pushback comes after Apollo Global Management CEO Marc Rowan questioned mark-up approaches used across the market, sparking debate about how fund stakes are valued and reported.

Rowan specifically challenged the widespread practice of purchasing fund interests at discounts to their previously reported net asset values, then immediately recording paper gains. This secondaries transaction approach involves buying stakes below NAV and marking them up at acquisition, drawing scrutiny from market observers who question the accounting logic.

The controversy focuses particularly on evergreen funds, which operate differently from traditional closed-end private equity vehicles. Unlike finite-life funds, evergreen structures continuously accept new capital while maintaining ongoing portfolios, creating unique valuation challenges that may justify these mark-up practices despite criticism.

Market participants are watching this debate unfold as it could influence how secondaries transactions are structured and priced. The outcome may affect deal flow and investor returns across the alternatives sector, with significant implications for fund managers and their clients.