Private Debt News Weekly Issue #42: Private Credit Wins Big, Banks Push Back, and Retail Investors Flood In
Private Lenders Secure €6.25 Billion Adevinta Deal, Banks Reclaim Refinancings, and Blackstone Expands Retail Access
The power struggle between banks and private credit continues, as direct lenders win a €6.25 billion Adevinta deal while banks reclaim major corporate refinancings from private funds. Meanwhile, retail investors gain deeper access to private credit, with Blue Owl launching a new retail-focused fund and Blackstone receiving SEC approval for its interval fund.
On the M&A front, CVC explores a Fortress Investment acquisition to gain more U.S. private credit exposure, while DWS turns to Deutsche Bank for a private credit rescue after struggling to gain investor traction. At the same time, valuation concerns grow, and private credit restructuring teams expand as default risks mount across the industry.
Here’s your breakdown of the week’s most critical developments shaping private credit.
Key Market Trends
Private Credit Wins €6.25 Billion Adevinta Financing, Edging Out Banks
Private lenders are set to finance a €6.25 billion loan package for Adevinta ASA, reinforcing their dominance in large-scale private equity-backed deals.
What’s Happening?
The new unitranche loan replaces a previous €4.5 billion direct lending deal, securing cheaper pricing at 4.75% over Euribor.
Private credit lenders will also provide €1.75 billion in additional credit, partly to fund a dividend recapitalization for Blackstone and Permira.
Why It Matters:
Banks pitched for this refinancing but lost out to direct lenders.
Despite competition, private credit is proving its ability to offer flexible solutions in uncertain markets, outmaneuvering banks in key buyout financings.
Banks Regain Ground in Corporate Refinancing Battles
Despite Adevinta’s win, banks have aggressively reclaimed market share in corporate debt refinancing, displacing private credit in several major deals.
Key Wins for Banks:
Morgan Stanley refinanced $3.9 billion for Kaseya, replacing Golub Capital’s private debt.
Multiple leveraged loan refinancings are pricing between 7%–7.5%, undercutting private lenders’ higher return targets.
Why This Matters:
Banks are pricing private credit out of refinancing deals, forcing direct lenders to focus more on new originations and special situations.
The public markets’ reopening is accelerating private credit’s shift toward asset-based finance and structured lending.
Retail Investors Flood Into Private Credit as Blue Owl and Blackstone Expand Access
Private credit’s retail expansion continues, with Blue Owl launching a new interval fund and Blackstone receiving SEC approval for its own retail-focused private credit vehicle.
Fund Highlights:
Blue Owl Alternative Credit Fund: Focused on asset-based finance and alternative credit, offering quarterly redemptions of 5%-25% of shares.
Blackstone Private Multi-Asset Credit & Income Fund (BMACX): Investing 80%+ in private credit, real estate, and asset-backed loans.
What’s Driving This?
Institutional capital allocations to private credit are maturing, forcing fund managers to tap retail investors for continued growth.
Interval funds provide a controlled entry point into private credit for wealth managers, sidestepping the liquidity concerns that plagued State Street and Apollo’s ETF launch.
CVC Eyes Fortress Investment Group in Potential Private Credit Expansion
CVC Capital Partners is exploring an acquisition of Fortress Investment Group, aiming to expand into U.S. private credit but facing valuation hurdles.
Why It’s Significant:
CVC has been aggressively seeking private credit expansion, previously considering HPS Investment Partners before BlackRock acquired it.
Fortress manages $49 billion in assets but has been stuck in limbo under Mubadala’s ownership.
What’s Next?
If CVC revives talks, it would mark another major consolidation deal in private credit, following Generali’s MGG acquisition and Wendel’s Monroe Capital takeover.
DWS Turns to Deutsche Bank After Private Credit Struggles
After failing to gain traction in private credit, DWS Group is relying on Deutsche Bank to rescue its strategy, securing preferred access to loans originated by the bank.
The Backstory:
DWS launched a private credit fund targeting €1 billion but struggled to attract investors.
DB Investment Partners, a competing Deutsche Bank private credit unit, is being shut down to funnel deal flow into DWS.
Why It Matters:
DWS is betting on bank-originated loans to differentiate itself from established giants like Blackstone, KKR, and Apollo.
This deal mirrors JPMorgan’s $50 billion direct lending push, signaling banks are becoming major players in private credit.
Market Risks & Restructuring Trends
Private Credit Firms Expand Restructuring Teams as Defaults Surge
With US corporate bankruptcy filings hitting a 14-year high, private credit firms are aggressively expanding their restructuring teams.
What’s Driving This?
69% of defaults in 2024 involved liability management exercises (LMEs), reflecting a growing reliance on aggressive restructurings rather than outright bankruptcies.
More lenders are engaging in “distress-for-control” takeovers, where private credit firms convert debt to equity to take control of struggling businesses.
Who’s Hiring?
Golub Capital is adding workout specialists to manage distressed loans.
Antares Capital tripled its workout team size to 18 professionals, signaling expectations for more restructurings.
Carlyle and Blackstone are hiring restructuring specialists to navigate tougher market conditions.
Forward Outlook
Banks vs. Private Credit: A Market Carve-Out is Emerging
Banks are reclaiming refinancings but private credit dominates new buyout financings and structured lending.
Expect more hybrid financing structures, blending bank and private credit solutions.
Retail Involvement in Private Credit Will Expand Further
Blackstone and Blue Owl’s interval funds mark a major shift, allowing individual investors to participate in private debt markets.
Expect more retail-focused funds to launch, but liquidity concerns remain.
M&A Activity in Private Credit is Accelerating
CVC’s interest in Fortress signals further consolidation, following BlackRock’s HPS acquisition and Generali’s MGG buyout.
Smaller private credit firms may struggle to compete independently, driving more M&A.
Restructuring Hiring Boom Will Continue
Lenders are building larger workout teams, preparing for an extended period of defaults and distressed opportunities.
Expect more “distress-for-control” transactions, where lenders take over struggling companies.
Defense Sector Financing Expands as ESG Restrictions Loosen
European credit funds are rewriting ESG policies to finance defense manufacturers, driven by rising military budgets.
This shift could open new lending opportunities in aerospace and defense financing.
Final Takeaway
Private credit continues to dominate new corporate financings while banks reclaim refinancings, marking a shift toward market segmentation rather than outright competition. Meanwhile, retail investors are entering private debt markets at scale, M&A activity is heating up, and restructuring teams are preparing for an extended cycle of distressed deals.
With competition, consolidation, and credit stress rising, private credit is entering a new phase of transformation.
Stay ahead with Private Debt News Weekly—your go-to source for insights, deals, and trends shaping private credit.