Private Debt News Weekly Issue #39: Goldman’s “Golden Age,” Valuation Scandals, and Private Credit’s Retail Expansion
Banks Push into Private Investment-Grade Debt, Zips Car Wash Exposes Valuation Flaws, and JP Morgan Opens Private Credit to Retail Investors
The private credit industry is evolving faster than ever, as investment banks, mega-funds, and regulatory forces reshape the landscape. Goldman Sachs calls this a "golden age" for private credit, as investment-grade private lending takes off, while JP Morgan and Pimco double down on asset-based finance over traditional direct lending. Meanwhile, fundraising for private credit remains concentrated at the top, with Ares adding $133 billion in fresh capital, and valuation concerns intensify after private lenders severely mispriced a bankrupt car wash loan.
As banks, private lenders, and regulators battle for control, here’s your breakdown of the week’s most pressing trends, deals, and risks shaping private credit.
Key Market Trends
Goldman Sachs Joins the Crowd and Declares a "Golden Age" for Private Credit
Private investment-grade lending is the next frontier as large corporations turn to private debt for long-term financing.
Why It Matters:
Mega-lenders like Apollo, Ares, and Goldman are seizing the opportunity to fund blue-chip companies that need large-scale, customized financing.
Traditional investment-grade markets are constrained, making private credit a more attractive option for issuers.
Leverage is shifting away from banks, allowing direct lenders to structure long-term, higher-margin deals with institutional clients.
Goldman’s View:
"This move into private investment grade is a game changer," said Christina Minnis, Goldman’s Head of Credit Markets, as the firm expands deeper into private lending.
Private Credit Valuation Concerns Escalate After Bankruptcy Blunder
A $654 million loan to Zips Car Wash was marked at 93-95 cents on the dollar just months before the company collapsed into bankruptcy.
What Happened?
Private lenders maintained high valuations even as Zips struggled with liquidity issues, refinancing failures, and declining revenues.
By February, the company filed for Chapter 11, slashing its debt load by 40%.
The Bigger Issue:
Private credit lacks daily price discovery, creating a lag between true loan performance and reported valuations.
Regulators and investors are questioning the accuracy of private credit marks, especially as more troubled loans surface.
Discrepancies between lenders' valuations highlight the opacity in private credit markets, where fund managers have wide discretion in marking loans.
What’s Next?
More calls for transparency and stricter valuation standards.
Potential regulatory intervention to mandate real-time disclosure of credit risk.
JP Morgan Expands Retail Access to Private Credit
JP Morgan Asset Management is launching its first-ever private credit interval fund, opening private debt to a broader base of investors.
Fund Details:
Named the JPMorgan Credit Markets Fund.
Will invest in corporate loans, structured credit, and private funds.
Quarterly liquidity capped at 5% NAV, similar to other interval funds.
Why It Matters:
Retail investors are increasingly demanding access to private markets, and major firms like JP Morgan, Apollo, and BlackRock are expanding offerings.
Democratizing private credit could reshape the investor base, bringing in more wealth management clients.
Liquidity concerns remain, as retail access to private debt has historically been limited due to redemption risks.
Recent Deals
Oaktree Leads $2.9 Billion Refinancing for Blackstone’s Encore
Oaktree Capital arranged a $2.9 billion refinancing for Blackstone’s audio-visual services firm, Encore Group.
Deal Structure:
$2.4 billion term loan at SOFR +500bps.
$250 million revolving credit facility.
Oaktree contributed $452 million.
Why It’s Important:
Private lenders continue to dominate large-scale refinancing deals, even as banks reclaim new buyout financings.
Private Credit Fuels $1.75 Billion Buyout of Triumph Group
A group of lenders, including Apollo Global Management, provided $1.75 billion in private debt to support Warburg Pincus and Berkshire Partners’ acquisition of Triumph Group, an aerospace parts manufacturer.
Key Takeaways:
Private credit remains the go-to option for leveraged buyouts, even as banks fight for market share.
Aerospace sector M&A is heating up, with direct lenders eager to finance strategic acquisitions in industrial sectors.
India’s Infrastructure Fund Raises $2 Billion for Private Credit Expansion
The National Investment & Infrastructure Fund of India is raising $2 billion to capitalize on rising demand for high-yield debt.
What’s Driving This?
Infrastructure and energy transition projects require flexible private credit solutions.
Institutional investors are seeking exposure to higher-yielding emerging market debt.
More sovereign-backed funds are entering private credit, expanding its global footprint.
Forward Outlook
Private Investment-Grade Lending Will Accelerate
Large corporations are increasingly turning to private credit for long-term financing, shifting the market from middle-market lending to blue-chip funding.
Private Credit Fundraising is Becoming Even More Concentrated
Ares’ record-breaking $133 billion raise signals that mega-funds will continue dominating fundraising.
Mid-sized lenders must specialize or risk losing capital flows to top-tier players.
Regulatory Scrutiny Will Increase on Valuations and Transparency
Zips Car Wash’s overvalued loan debacle has highlighted the flaws in private credit pricing models.
Expect new disclosure requirements around real-time credit risk reporting.
Retail Investors Are Entering Private Credit in a Big Way
JP Morgan’s interval fund launch will open private debt to high-net-worth and retail investors, potentially changing liquidity dynamics.
More firms will follow, but regulatory approval and risk management remain key hurdles.
Private Credit’s Role in M&A Will Expand Further
With banks still cautious on large buyouts, private lenders will remain the dominant force in leveraged finance.
Direct lenders are already backing major deals like Triumph Group’s $1.75 billion acquisition, with more on the horizon.
Final Takeaway
Private credit continues to evolve at a rapid pace—investment banks are gaining ground on pricing, mega-funds are consolidating power, and regulators are tightening their grip. With more capital flowing into asset-based finance and investment-grade private lending, the industry’s next phase will be defined by scale, specialization, and transparency.
Stay ahead with Private Debt News Weekly—your trusted source for the latest deals, trends, and insights shaping the private credit market.
Like public bonds but less disclosure, less access, and fees paid by investors (to get access) instead of issuers
Nice work. Interval fund liquidity / gating is going to bite some retail investors in the a$$ at the worst time.