Key Takeaways
- • Private credit managers are looking to sell battered business development companies (BDCs), and rival firms are eyeing the distressed vehicles as a shortcut to growth, according to Bloomberg.
- • Ares Management Corp., Barings LLC, BC Partners and Churchill Asset Management have reviewed troubled funds in recent months, according to people familiar with the matter.
- • Discussions are preliminary and may not result in any transactions, the people said, asking not to be identified.
- • The activity comes amid one of the most turbulent periods for the $1.8 trillion private credit market.
Summary
Private credit managers that are increasingly looking to offload struggling funds are drawing interest from rivals seeking to acquire them at discounted prices, according to Bloomberg. The report, headlined as a rare growth shortcut for the sector, describes BDC sale discussions as part of a broader shakeup in private credit at a time of heightened market turbulence for the roughly $1.8 trillion asset class.
According to people familiar with the matter, Ares Management Corp., Barings LLC, BC Partners and Churchill Asset Management have evaluated troubled funds in recent months. Bloomberg reports that these firms are weighing cheap deals that could allow them to scale their platforms more quickly than through organic fundraising.
The people cautioned that the talks remain preliminary and may not result in any transactions. They asked not to be identified because the discussions are private. The source material does not disclose the specific funds under review, their valuations, or the terms being considered.
For allocators, the developments highlight the pressure facing some BDC structures and the opportunities that distressed situations can create for well-capitalized managers. Investors monitoring private credit exposure should watch whether these early discussions progress to signed transactions.
According to people familiar with the matter, Ares Management Corp., Barings LLC, BC Partners and Churchill Asset Management have evaluated troubled funds in recent months. Bloomberg reports that these firms are weighing cheap deals that could allow them to scale their platforms more quickly than through organic fundraising.
The people cautioned that the talks remain preliminary and may not result in any transactions. They asked not to be identified because the discussions are private. The source material does not disclose the specific funds under review, their valuations, or the terms being considered.
For allocators, the developments highlight the pressure facing some BDC structures and the opportunities that distressed situations can create for well-capitalized managers. Investors monitoring private credit exposure should watch whether these early discussions progress to signed transactions.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.