Private Credit Insights

Just in: Thoma Bravo in talks for $3.5bn private credit financing for portco ConnectWise Asking for a 7x leverage, Thoma Bravo is looking to use the proceeds to repay existing financing and an acquisition for ConnectWise, the automated professional services provider based in Florida, reports Bloomberg. While simultaneously engaging bank market, the sponsor is asking the private lenders to price the package at c.500bps over SOFR, similar to levels seen in recent private debt deals across sectors, suggesting a slight compression in spreads, potentiallly due to competitive landscape and the general shift in macro sentiment. Thoma Bravo acquired the company in 2019, and have priced a $1.1bn debt package in 2021 at 350bps over in the syndicated bank market to repay private credit financing. Currently, the company’s bonds are trading at par, signalling strong credit investor interest around the transaction on top of the firm’s B2 rating. As we gradually enter into the rate cut cycle, it’s likely that we’ll see more private financing provided at a cheaper price. However the booming bond market might also offer credit managers an easier path to leveraging capital. Follow to keep updated in private credit and alternative investment. #privatecredit #privateequity #investmentbanking #financing #leveragedfinance

Just in: Blackstone and Goldman Sachs back $500m private financing for KKR’s acquisition of Perpetual Limited Structured as a covenant light unitranche, the debt package provided by Blackstone and Goldman Sachs Asset Management is a blend of senior and junior priced around mid 500bps, reports Bloomberg. The ticket is only for the corporate trust unit of Australia based Perpetual, while the whole transaction including the wealth management unit could reach around $1.5bn in deal value. Once again we are seeing more borrower friendly terms in the private credit market as lenders compete for the best deals to deploy dry powder and are willing to make compromises with sponsors to push the deals over the finish line. As we gradually shift into the rate cuts cycle, it’s possible we’ll be seeing more competitive terms by credit managers to make deals happen. Follow for more insights in private credit and alternative investment. #privatecredit #privateequity #investmentbanking #assetmanagement #interestrates

Just in: Fortress Investment Group underwrites £750m structured private debt for consumer loan company Tabeo Structured as a “forward-flow agreement”, the deal provides upfront financing for Tabeo, which specialises in managing and monitoring loans made by consumers, particularly in the healthcare / dental sector. Backed by the future cash flows from customers, this type of specialty asset backed lending has gained significant interest in the private credit sector, particularly as banks are retrenching from consumer-oriented business given their risk appetite, reports Bloomberg. Direct lending leaders such as Ares Management Corporation, KKR and others have all set up funds focusing specifically on consumer financing. Structured finance seem to be regaining focus as the private credit world expands and credit managers look to explore more innovative ways to leverage capital. Another good example in the space would be the recent Intel-Apollo deal, which combines both trending themes of structured finance and infrastructure, shining a spotlight on the specifically designed structure. Follow to keep up with deal news in private credit and alternative investment. #privatecredit #privateequity #investmentbanking #assetmanagement #financing

Deal news: Blackstone engages $2.8bn private refinancing for portco Encore at discount Looking to address the upcoming debt maturities for its portfolio company Encore, an audio-visual event services company, Blackstone is in talks with private credit lenders for a financing package. The structure would include a $2.3bn unitranche blending senior and junior, priced c.500bps over SONIA, at 98 cents on the dollar, reports Bloomberg. A $500m pref equity piece would also be raised alongside the unitranche. Proceeds used for Encore’s existing debt maturing in the next 2 years. On top of the discounted price, the deal is also designed in a borrower friendly, covenant light style with a portable structure, meaning the financing could remain in place if the business was sold, instead of the more conventional full take out scenario. Private credit managers have received an unprecedented amount of dry powder and are actively deploying capital. Competitions heating up as lenders are now looking at cheaper pricing and investors protection. More deals to come as the private credit space expands. Follow for the latest in private credit and alternative investment. #privatecredit #privateequity #investmentbanking #alternativeinvestment #directlending

Just in: Blackstone leading $2bn private credit loan to Park Place Technologies With Blue Owl Capital also participating in the transaction, the package includes a $1.7bn loan, a capex facility and a RCF. The proceeds will be used to refinance existing debt as well as pay out the private equity sponsors GTCR LLC and Charlesbank Capital Partners, report Bloomberg. Once again, against the recent trend of public market rally, this is another case where private credit lending are being used to take out broadly syndicated loans. The deal is expected to repay $845m first lien loan provided by banks and institutions alongside a $230m second lien. It’s also been observed more that private credit instruments are used to pay out dividends or even at a fund level as NAV facilities to return capital back to LPs. Increased market share reach, potentially we may see more large sized ticket this year by private lenders. Follow for the latest in private credit and alternative investment. #privatecredit #privateequity #investmentbanking #alternativeinvestment #directlending

Just in: Blackstone and Sixth Street leads new £1.5bn private financing with razor-thin margin for Iris Software Inc. The package includes a GBP and USD denominated $950m unitranche, a £500m capex facility and £170m RCF. Priced at a ultra thin margin of 475bps over SOFR, it is at least 100bps tighter than similar transactions seen not too long ago. The proceeds will be used to refinance Iris’ existing £800m term loan and fund additional growth capex. Partly due to the nature of its business, Iris has been a hot target by the private lenders as well as banks in the UK, given the history of its potential sale by private equity owner Hg in 2021. Unlike the buyout structure, this transaction has a lower leverage, which is reflected in the pricing. Aside from the cheap rates, the large syndicate group also has many strong names, including Goldman Sachs Asset Management, GIC, HPS Investment Partners, LLC, Sumitomo Mitsui Banking Corporation – SMBC Group, Aimco, Brookfield Asset Management, M&G Investments, Macquarie Group, Quadrant, and PSP Investments, reports Bloomberg. It’s evident that banks and private lenders are in fierce competition for deals — would the cheaper pricing become a trend? Follow to stay updated in private credit and alternative investment. #privatecredit #privateequity #investmentbanking #goldmansachs #directlending

Just in: KKR raises more than $2bn for US direct lending evergreen fund Aiming at institutional investors, KKR has raised the third fund with the same evergreen structure, building on the basis of a levered US fund and a European one which raised over $4bn, reports Bloomberg. Launched in March 2023, this fund allows investors to redeem part or all their stake instead of years of locked up capital post initial upfront commitment. The fund is targeting upper middle market companies with earnings around $50m-$100m under the direct lending strategy, which has raised over $10bn over the past 12 months. Some notable deals include the previously covered $2.8bn financing backing Clarience Technologies’ acquisition of Safe Fleet, and $2.34bn unitranche facility for MB2 Dental’s acquisition and growth. More LP capital flowing into the private credit space, significant amount of dry powder to deploy. Follow to stay updated in private credit and alternative investment. #privatecredit #privateequity #investmentbanking #directlending #fundraising

Just in: Adams Street Partners raises $1bn for first private credit CLO Owned entirely by the issuer and funded by American Equity Investment Life Insurance Company, this is the first vehicle targeting middle market firms and packages the direct lending loans into securities, reports Bloomberg. Joining competitors such as HPS Investment Partners, LLC and Blue Owl Capital in the CLO space, this is its latest partnership with American Equity Investment Life since the JV partnership in 2021, adding to its c.$10bn AUM in credit assets. The vehicle “ASP Summa” will be a mix of 40 originated risky and safe first lien loans of private equity sponsors backed firms, customised to optimise yield vs capital charge for insurance firm, and priced at least 600bps over SOFR. Follow to stay updated in private credit and alternative investment. #privatecredit #privateequity #directlending #investmentbanking #investing

Just in: Antares Capital LP leads c.$1.5bn refinancing for Genstar Capital backed OEC Leading a group of private credit lenders, Antares is providing a refi package for the software development firm, which includes a $1.15bn unitranche, a $200m capex facility and a $125m revolver. The proceeds will be used to refinance the existing debt of c.$600m first lien and $365m second lien. Once again, we are seeing firms opting for private credit solutions to take out broadly syndicated debt, which is a reflection of the popularity and competitive edge of the private lenders. While public market conditions may be volatile on the back of economic indicators, central bank speeches, or even credit events in similar sector, private lenders could prove to be more stable in supporting immediate funding needs. Follow to stay updated in private credit and alternative investment. #privatecredit #privateequity #investmentbanking #alternativeinvestment #investing

Deal news: record-setting $4.8bn strategic acquisition financing led by Ares Management Corporation and Blue Owl Capital Leading a group of private lenders including Apollo Global Management, Inc., Blackstone, Oaktree Capital Management, L.P., HPS Investment Partners, LLC, Antares Capital LP, Golub Capital and Goldman Sachs, Ares and Blue Owl are structuring one of the largest ever private credit financing to back Novo Holdings’ acquisition of Catalent Pharma Solutions, reports Bloomberg. The total deal value to buyout the pharmaceutical manufacturer reaches $16.5bn, while the financing package itself contains a $4.2bn term loan and $575mn revolver. This is one of the largest private credit transactions ever done and definitely topping the record for this year. With the acquisition, the Novo-entities have expanded capacities to produce drugs in surging demand, for example used in weight-loss and diabetes treatment. Follow to stay updated on the latest deal news in private credit and alternative investment. #privatecredit #privateequity #investmentbanking #investing #alternativeinvestments