Before the market opened on December 11, Ares Management — a private-credit powerhouse with nearly $600 billion under management — slid into the S&P 500. It shoved out snack giant Kellanova, which completed its $35.9 billion sale to Mars that same day, while Vital Farms replaced Heidrick & Struggles in the S&P SmallCap 600 after the executive-search firm closed its $1.3 billion take-private just one day earlier.
This isn't just housekeeping. In two years, Blackstone, KKR, Apollo and now Ares have turned alternative asset managers into core S&P 500 holdings, while classic consumer and professional‑services names are taken private. Trillions in index-tracking money now funnels more directly into private-credit risk — just as regulators launch the first major stress test of the sector. The Bank of England's December 2025 exercise, involving all four S&P-listed alternative giants, signals that the shape of the U.S. stock market has quietly tilted toward Wall Street's dealmakers at the very moment their business model faces unprecedented scrutiny.
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People Involved
Michael Arougheti
Co‑founder and Chief Executive Officer, Ares Management (Leads the newest alternative asset manager to enter the S&P 500)
Steve Cahillane
Chairman and CEO, Kellanova (Former Chairman and CEO of Kellanova; transaction completed December 11, 2025)
Andrew Clarke
Global President, Mars Snacking (Architect of Mars’s expansion via Kellanova acquisition)
Carmine Di Sibio
Chairman of the Board of Managers, Heidrick & Struggles; Operating Partner, Advent International (Leading Heidrick's transformation as a private company under Advent and Corvex ownership)
Organizations Involved
AR
Ares Management Corporation
Alternative asset manager
Status: New S&P 500 constituent and major private-credit player
Ares is a global alternative investment firm whose private credit engine just earned it a spot in the S&P 500.
KE
Kellanova
Consumer packaged goods company
Status: S&P 500 constituent being acquired by Mars, exiting public benchmarks
Kellanova, home to Pringles and Cheez‑It, is leaving the S&P 500 via a Mars buyout.
MA
Mars, Incorporated
Private food and pet-care conglomerate
Status: Acquiring Kellanova and expanding private control over global snack brands
Mars is using its private balance sheet to roll up marquee snacking brands that once anchored public indexes.
S&
S&P Dow Jones Indices
Index provider
Status: Gatekeeper deciding which companies enter or leave the S&P equity benchmarks
S&P Dow Jones Indices runs the S&P 500 and quietly shapes where trillions of passive dollars flow.
HE
Heidrick & Struggles International
Executive search and leadership advisory firm
Status: Being taken private by Advent and Corvex; removed from S&P SmallCap 600
Heidrick is another public services firm leaving equity benchmarks via a private‑equity‑backed buyout.
VI
Vital Farms, Inc.
Food company (pasture-raised eggs and dairy)
Status: New S&P SmallCap 600 constituent replacing Heidrick & Struggles
Vital Farms is a mission‑driven food brand promoted into the S&P SmallCap 600.
AD
Advent International
Private equity firm
Status: Lead buyer in Heidrick take‑private and active consolidator across sectors
Advent is using abundant private capital to pull listed companies like Heidrick off public markets.
Timeline
Ares enters S&P 500; Kellanova and Heidrick exit key indexes
Market Event
Before the U.S. market opens, Ares Management officially joins the S&P 500, displacing Kellanova as Mars prepares to close its acquisition. In parallel, Vital Farms joins the S&P SmallCap 600 in place of Heidrick & Struggles. Index‑tracking and benchmark‑aware investors rebalance, sending fresh flows into Ares and Vital Farms and out of the departing names.
Mars formally closes $35.9 billion Kellanova acquisition
M&A
Mars completes its purchase of Kellanova the same day the snack company exits the S&P 500, creating a combined snacking business with $36 billion in annual revenues, 9 billion-dollar brands, and operations in more than 145 markets with 50,000 employees. Mars Snacking will be headquartered in Chicago.
Heidrick & Struggles closes its all‑cash sale to Advent International and Corvex Private Equity one day ahead of its removal from the S&P SmallCap 600, earlier than the initially expected Q1 2026 timeline. The 70‑year‑old executive search firm's common stock ceases trading on Nasdaq. Former EY Global Chair Carmine Di Sibio joins as Chairman of the Board of Managers.
EU signs off on Mars–Kellanova deal; S&P announces Ares index switch
Regulatory / Index Change
The European Commission clears Mars’s $36 billion Kellanova takeover, removing the last major antitrust obstacle and allowing closing on December 11. That same day, S&P Dow Jones Indices announces that Ares will replace Kellanova in the S&P 500, while Vital Farms will replace Heidrick & Struggles in the S&P SmallCap 600.
Bank of England launches major private credit stress test
Regulatory
The Bank of England begins its second system‑wide exploratory scenario exercise, focused on how private markets operate under stress and their implications for UK financial stability. Participants include all four S&P 500‑listed alternative managers — Ares, Blackstone, KKR and Apollo — plus Goldman Sachs, Carlyle, CVC, Bain Capital, ICG and Permira. The exercise will run through 2026 with a final report in early 2027, marking the first comprehensive regulatory stress test of the $16 trillion global private markets sector.
Advent and Corvex strike $1.3 billion deal to take Heidrick private
M&A
Heidrick & Struggles agrees to an all‑cash take‑private led by Advent International and Corvex Private Equity at $59 per share. The deal continues a resurgence in private-equity buyouts and sets up Heidrick’s removal from the S&P SmallCap 600 once the transaction closes.
S&P raises size thresholds for index additions
Rules
S&P Dow Jones Indices hikes the required unadjusted market cap for new S&P 500 additions to $20.5 billion, with higher bands for the MidCap 400 and SmallCap 600. The change makes it harder for smaller companies to graduate into the benchmarks and entrenches today’s large‑cap leaders.
Apollo Global Management added to S&P 500
Index Change
S&P Dow Jones Indices slots Apollo and Workday into the S&P 500, removing Qorvo and Amentum. With Apollo joining Blackstone and KKR, alternative asset managers become a visible cluster within the index’s financials sector.
Mars agrees to buy Kellanova in $35.9 billion snacks megadeal
M&A
Mars announces a cash deal to acquire Kellanova, the Kellogg spinoff behind Pringles and Cheez‑It, for $83.50 a share. The transaction, among the snack sector’s largest, sets up Kellanova’s eventual removal from major indexes once regulatory approvals arrive.
KKR joins S&P 500 at June 2024 rebalance
Index Change
At its June rebalance, S&P adds KKR, CrowdStrike and GoDaddy to the S&P 500 and removes Robert Half, Comerica and Illumina. The move deepens the index’s exposure to private equity and private credit via KKR’s diversified platform.
Blackstone becomes first mega private-equity firm in S&P 500
Index Change
S&P Dow Jones Indices adds Blackstone and Airbnb to the S&P 500 at the quarterly rebalance, booting Lincoln National and Newell Brands. It’s the first time a giant listed private‑equity group joins the benchmark, signaling that alternative managers have grown too big to ignore.
Scenarios
1
Alternative Asset Titans Become Core of the S&P 500 Financials Sector
Discussed by: Reuters, Financial Times, Zacks and sell-side strategists focused on private markets and index structure
In this path, Ares’s entry proves to be one more step in a march toward dominance. Blackstone, KKR, Apollo and Ares keep raising ever-larger funds, and perhaps one or two more alternative managers eventually clear the new $20.5 billion bar to join the S&P 500. As pensions and 401(k) plans pour money into S&P‑tracking products, a growing share of household savings effectively backs private credit and buyout firms. The index’s financials sector becomes less about banks and insurers, more about fee‑rich asset gatherers and shadow banking. Volatility spikes when private credit cycles turn, but the business model remains intact.
2
Regulators Clamp Down on Private Credit, Forcing Index Providers to Rebalance Again
Discussed by: Columnists at the Financial Times and Reuters Breakingviews; bank and credit analysts warning about systemic risk
Here, concerns about opaque private‑credit exposures boil over after a wave of corporate defaults or a high‑profile fund blow‑up. Regulators impose tougher capital, disclosure or leverage rules on alternative managers, or limit how much illiquid credit exposure retail‑facing funds can hold. Valuations for alt managers compress, and S&P’s index committee faces pressure to reconsider how much of the benchmark is tied to private markets and shadow banking. In an extreme case, one manager shrinks enough to be demoted back to a mid‑cap index, triggering a messy forced‑selling episode from passive investors.
3
Consumer Staples and Services Keep Going Private, Shrinking Their Footprint in the Index
Discussed by: Consumer-sector analysts, M&A bankers, and business press covering deals like Mars–Kellanova and Heidrick’s buyout
In this scenario, Mars’s Kellanova purchase is part of a broader wave: family‑owned groups and private equity continue snapping up mature, cash‑generative consumer and professional‑services companies at premiums public markets won’t match. Each deal forces S&P to plug the gap with smaller, faster‑growing names or with firms from totally different industries. The consumer‑staples sleeve of the S&P 500 becomes more concentrated in a handful of global giants that remain listed, while much of the everyday grocery aisle lives in private hands. Public‑market investors get more growth and cyclicality, but less steady, dividend‑rich defensiveness.
4
Stress Test Reveals Systemic Fragility, Sparking Capital Requirements for Private Credit
Discussed by: Bank of England, Financial Times, regulatory analysts tracking shadow banking risks
The Bank of England's 2026–27 stress test uncovers interconnected leverage, liquidity mismatches or valuation opacity that could amplify a downturn. Regulators respond with capital buffers, mandatory stress disclosures or constraints on leverage for private credit funds, especially those backed by insurance capital. Alternative asset managers face higher costs and slower growth, compressing valuations and prompting some index watchers to question whether these business models belong in core equity benchmarks at current weights. Index providers may tighten sector concentration limits, and passive investors begin demanding clearer disclosure of private-credit risk exposures.
Historical Context
Blackstone’s 2007 IPO: Private Equity Steps Onto Public Markets
2007
What Happened
Blackstone went public in June 2007, near the peak of the pre‑crisis buyout boom. The offering crystalized huge founder wealth and gave public investors direct exposure to private equity’s fee streams and carry, even as critics warned about cyclicality and opacity.
Outcome
Short Term
The stock initially struggled through the financial crisis as deal activity and valuations collapsed, reinforcing fears about cyclicality.
Long Term
Blackstone rebounded, crossed $1 trillion in AUM, and eventually earned S&P 500 membership in 2023, legitimizing private equity as a core public‑market sector.
Why It's Relevant Today
Ares’s S&P 500 entry is the logical next step in a journey that began when firms like Blackstone first invited public shareholders into the private‑markets business model.
Tesla Joins the S&P 500, Supercharging Passive Flows Into a Single Stock
2020
What Happened
After years of debate, S&P Dow Jones Indices added Tesla to the S&P 500 in December 2020, forcing index funds and closet trackers to buy tens of billions of dollars’ worth of stock. The move intensified scrutiny of how index decisions anoint winners and shape flows.
Outcome
Short Term
Tesla’s inclusion triggered significant rebalancing volume and highlighted how concentrated bets can become when a popular stock enters a major index.
Long Term
The episode cemented public awareness that index construction is an active choice with market consequences, not a neutral mirror of the economy.
Why It's Relevant Today
Ares’s inclusion similarly channels passive flows into a specialized, controversial business model — private credit — underscoring how index committees now shape exposure to entire financial structures.
Dot‑Com Darlings Flood the S&P 500 Before the 2000 Crash
1999–2000
What Happened
During the late 1990s tech boom, S&P and other indices added a wave of high‑flying internet and telecom stocks. Many soon collapsed when the bubble burst, leaving passive investors overexposed to a frothy sector at the worst possible time.
Outcome
Short Term
Index investors suffered steep losses as speculative names imploded, prompting questions about whether inclusions had come too late in the cycle.
Long Term
Index providers refined profitability and liquidity screens, but the episode left a lasting lesson: sector waves can distort benchmarks just as they peak.
Why It's Relevant Today
Today’s rise of alternative asset managers and private credit in the S&P 500 raises a similar question: are benchmarks baking in a boom sector just as its risks become systemic?
