What characteristics of loans will cause the biggest problems in the future? When asked what characteristics of loans determine which middle market lenders will see the biggest problems in the future at LPC’s 7th Annual Middle Market Loans Conference, earlier this month, half of respondents chose weak documents, including aggressive EBITDA add-backs. Another 35% said…
UK Dominates European Private Debt Europe is the second most active region for private debt after North America, but the scale and nature of activity varies widely throughout the region. While the potential investment opportunities and industries are more diverse, the fund management industry is very homogenous, and is dominated by firms based in the…
European senior debt is a big winner – for only a few managers What’s better than being on top, both in the capital structure and fundraising totals? European senior debt funds collected a record amount of cash in the first quarter, but notably, the period had the fewest number of fund closes. We conclude that…
Public versus private The private equity industry has matured quite a bit over the years. The most visible marker is the handful of firms that have gone public, despite the public market’s difficulty in valuing the complex, variable cash flows that are inseparable from the PE model…. Subscribe to Read MoreAlready a member? Log in
Distressed Debt Funds Stall in 2019 Distressed debt has long been a major component of the private debt industry. Around the time of the Global Financial Crisis (GFC) in 2008, the strategy raised a record $45bn in capital – a level that has never been equalled – and performance of funds raised around this time…
North American private credit market: sponsored by private equity The fates of the two asset classes are largely intertwined and the deluge of private equity capital bodes well for debt managers’ dealflow. In case it wasn’t clear that the North American sponsored finance market is booming, here’s a set of figures for you. Private equity…
BDC returns superior so far in 2019 BDC share prices are on a tear in 2019. The Wells Fargo BDC Index has delivered a stunning +18.0% return so far in 2019 through May 17th. This is outpacing the S&P500 (+14.1%) and the S&P/LSTA Leveraged Loan Index (+5.72%). Several BDCs are near 52 week highs. Oaktree…
Why are add-ons getting so much bigger? Download PitchBook’s Report here. The median add-on size almost doubled in the span of two years. The $41 million median seen in 2016 ballooned to $76 million last year, an 86% difference. At first glance, it looks like platform deal sizes have gone up much more rapidly, but charts…
When junior debt fundraising comes out on top The lack of mid-market mezzanine opportunities has likely caused the size of mezzanine funds to grow faster than senior debt vehicles. Fewer firms are raising a greater portion of all private debt capital, but this stands out to be particularly true in mezzanine debt. Junior loan funds…
Private Real Estate Debt Attracts Investors The private real estate debt market has grown significantly in recent years as fund managers have sought to capitalize on the opportunity provided by banking regulation, and investors have targeted exposure to the stable income and portfolio diversification that debt investments can provide…. Subscribe to Read MoreAlready a member?