Private Debt News Weekly Issue #45: Tariff Turmoil Shakes Debt Markets, Private Credit Circles ‘Hung’ Bank Deals
Volatility stalls $12B+ in financings, while private credit firms grab deals, mark risk, and reprice the playbook.
This week, Trump’s tariffs paralyze bank-led financings, putting billions in syndicated debt at risk. Private credit firms are circling, ready to scoop up “hung” deals—at a price. Meanwhile, Apollo, BlackRock, and Sixth Street double down on retail, and Coller Capital breaks records with a $1.6 billion secondary credit transaction.
Elsewhere, lenders are pushing into residential mortgages, new venture credit models emerge, and regulators demand transparency as tariff-related chaos triggers a market reset. Welcome to private credit’s moment of opportunity—and reckoning.
Key Market Trends
Tariff Shock Reshapes Debt Markets as Banks Pull Back
Trump’s sweeping tariffs have stalled more than $12 billion in buyout financing, leaving banks scrambling and private credit funds on speed dial.
Patterson’s $2.35B debt deal stalled, with lenders hesitant to syndicate in volatile conditions.
ABC Technologies’ $2.2B financing remains unsold, even as an April 15 closing deadline looms.
Chuck E. Cheese’s $660M bond issue and Validity’s $500M loan are now being pitched to private credit after banks failed to place them.
What it means:
Banks are offloading risk to direct lenders, often at a discount. Private credit is stepping in—but it’s a buyer’s market now.
Private Lenders Brace for Portfolio Damage
Private credit managers are triaging portfolios as tariffs raise costs and choke revenue.
Ares, TCW, and JPMorgan are all reviewing exposure to consumer, auto, and manufacturing borrowers.
Workarounds include PIK toggles, EBITDA adjustments, and operational restructuring.
Tariffs on China have surged to 125%. Despite a 90-day pause for other countries, volatility is the new constant.
Secondary Market Matures: Coller Breaks $1.6B Credit Deal Record
Coller Capital bought a $1.6 billion senior direct lending portfolio from American National, acquiring LP positions across 44 credit funds and 3,000 loans.
Largest-ever LP-led credit secondaries transaction.
Reflects the rise of liquidity demand in private credit—a sector built on lockups, now seeking exits.
Retail Capital Keeps Coming
Apollo’s S3 Fund Offers Loyalty Bonus
Investors who stay 3 years get a 3% bonus.
No performance fee. All-in cost: 6.6%.
BlackRock’s Larry Fink Pitches Private Assets for 401(k)s
Says 60/40 is dead. New model: 50/30/20, with 20% in private credit, PE, infrastructure.
Launching portfolios with 15%+ private asset exposure for mass affluent clients.
Asset-Based Lending Expands
Private Credit Eyes Residential Mortgage Market
Lenders like TPG Angelo Gordon and Sixth Street are entering the $50 trillion housing market.
Focus is on home equity loans and lines of credit, now $400 billion+ in outstanding volume.
Mortgages not backed by Fannie or Freddie are being repackaged and sold as bonds to insurers.
Deal Highlights
Apollo & Citi: Offering $3.5B at SOFR + 450bps for Boeing’s Jeppesen unit—the cheapest LBO staple financing YTD.
Thoma Bravo: Selling down $525M in second-lien SolarWinds debt.
Coller Capital: Closes record $1.6B LP-led secondaries deal.
Blackstone & Goldman: Team up on €350M loan for Bain’s buyout of Namirial.
Validity’s $500M loan now pitched to private credit after bank interest dried up.
Savara secures up to $200M from Hercules Capital ahead of FDA decision.
Fundraising Updates
Kotak Alternate Asset Managers (India): Targeting up to $2B.
Capital Four (Denmark): Final close of €3B for senior debt fund.
Fortress: Raising $1.5B for new asset-backed strategy.
Freeport Financial: $2B raised for sixth direct lending fund.
AlbaCore Capital: $1.8B first close for new European fund.
Forward Outlook
Private Credit Will Keep Absorbing Broken Bank Deals
Expect fire-sale discounts, tighter covenants (in theory), and more rescue financings.
Retail Capital Will Outpace Institutional Growth
Loyalty rebates, fee-free structures, and 401(k) exposure mean Main Street is here to stay.
Valuation Frictions Will Surface
As tariffs pressure revenue, expect more internal PIK usage and asset markdowns in upcoming earnings.
Secondary Market Evolution Begins
More LP-led transactions like Coller’s $1.6B deal to come. Liquidity will matter in a higher-vol environment.
Housing is the Next Credit Frontier
With banks pulling back, non-bank lenders are moving into home equity at scale.
Final Takeaway
The post-tariff private credit cycle is here. Banks are ducking risk, direct lenders are buying it—cheap. Spreads are tight, but volatility is high. And retail investors are piling in just as defaults begin to rise.
It’s still private credit’s market—but only for those willing to price risk correctly.
Stay tuned with Private Debt News Weekly—your edge on the deals, signals, and shifts defining the next phase of private credit.