New Mountain Capital is weighing the launch of a continuation fund for Azuria Water Solutions, signalling the private equity firm’s intent to extend its hold on the water infrastructure company amid a challenging dealmaking climate, according to a report by Bloomberg.
Sources familiar with the matter, speaking anonymously due to the confidential nature of discussions, indicate the secondary fund could exceed $1bn in size. However, New Mountain is also considering alternative options, including selling a stake in Azuria to another investor.
New Mountain initially invested in Azuria and fellow water infrastructure firm Inframark through its sixth flagship fund, New Mountain Partners VI LP, which closed with $9.6bn in commitments in early 2021.
In a notable deal in May 2021, New Mountain took Azuria – formerly Aegion – private in a transaction valued at approximately $963m. Since then, Azuria has pursued a series of acquisitions and recently announced plans to merge with Inframark.
A sustained slowdown in primary private equity transactions has intensified activity in the secondary market, which hit a record $103bn in volume in the first half of 2025, according to Jefferies Financial Group.
Other firms including Centerbridge Partners, Sterling Partners, and Odyssey Investment Partners have also turned to single-asset continuation funds as a strategy to maintain ownership of prized portfolio companies amid uncertain market conditions.
Goldman Sachs has been engaged to advise on the potential transaction.
