Private Credit Trends Today

While public markets appear to be headed to more choppiness this fall, private markets are just gearing up. We suspect the same worries bedeviling liquid markets are supporting M&A. As a seller, why not cash in your chips today, rather than risk a reduction in your after-tax proceeds tomorrow?

Financings are being issued at a faster clip than just a few months ago. And while terms have eased somewhat in favor of issuers compared to the first quarter, they’re still more investor-friendly than last year.

What factors will determine the direction of terms for the rest of the year? Well, for one thing: supply/demand. Mid caps are creatures of competition. The bigger the pipeline, the more choices investors have, so the more likely issuers will see push-back on terms…

▶︎ Read Sept 7 2020 newsletter: here

▶︎ Chart of the Week: here (by Nuveen, Bloomberg, BLS)