What is Driving Increasing Deal Sizes in Private Credit? Direct lenders have increasingly been targeting larger companies, after previously focusing on middle market sized companies. (Fitch loosely defines larger as companies with about $500 million of debt and about $100 million of EBITDA or above)… Login to Read More...
The rise of quasi-distress As fund managers become adept at heading off problems before they threaten to kill companies off, distressed strategies are changing in nature. The news in August last year that Oaktree Capital Management was in the market with an ambitious $18 billion target for its latest opportunistic credit fund highlights the burgeoning…
Is stress emerging to save Asian fundraising? Last year was tough for GPs seeking capital to invest in Asia Pacific but distressed/opportunistic strategies were bucking the trend. Fundraising for private credit in Asia Pacific took a nasty hit in 2023, with just 11 funds reaching the finish line, compared with 33 the year before. The…
Defaults: Rates steady, but signs point to increases later this year Direct lending defaults and non-accruals are low, yet other key measures suggest there’s room for growth in both segments later this year and into 2025. Some expect fragile assets to start crumbling by the second half of 2024—there’s not much runway left after an…
Rising Payment-in-Kind Trends in Private Credit Will Have a Mixed Impact Interests paid-in-kind (PIK) are likely to rise among private middle-market loans in the US through both amendments to existing loans and as an optionality in new loan originations, as the impact of higher rates fully kicks in and credit burden builds up among borrowers….
Daily Analytic: Survey – Unitranche spreads shift lower Stiffer competition from the syndicated market has put pressure on direct lenders to tighten spreads on unitranche loans. According to LSEG LPC’s 2Q24 Middle Market Outlook Survey, 36% of direct lender respondents said their minimum threshold for unitranche spreads was in the 500-525bp range…. Login to Read
North American-based private debt AUM hits $1tn Private debt in North America has overtaken real estate in 2023 to become the second largest private capital asset class by assets under management (AUM), topping $1tn for the first time. AUM grew 18% in H1 2023, faster than private equity (13%), and private capital markets overall (11%)….
BDC assets under management reach a new high of US$315bn BDC assets under management (AUM) reached a new high of US$315bn at the end of 2023. The new record represented a 4% increase during 4Q23 and a 15% gain over the course of the year…. Login to Read More...
Volatile times, but no distressed boom Capital raising for distressed and special situations strategies has remained at modest levels since hitting a peak in 2019. Fundraising for distressed and special situations strategies has remained remarkably consistent, even as the long-term effects of the covid pandemic, rising inflation, war in eastern Europe and the continuing fear…
Daily Analytic Survey: What is your expectation for middle market M&A lending in 2Q24 relative to 1Q24? According to preliminary results from LSEG LPC’s quarterly middle market lender outlook survey, a large majority, nearly 70%, of respondents think that there will be a moderate increase in M&A activity in 2Q24, compared to 1Q24. Another 26%…