👋 Hey, Nick here. A big welcome to the new subscribers from La Caisse, Sycamore Tree, and Tannenbaum Capital Group. You’re now one of the 3,392 subscribers, and you’re reading the 184th edition of my private credit newsletter.
Reading on Outlook? The charts won’t render. Read it online
📕 Reads of the Week
Manager & Deal Updates
Claret Capital, a European Technology & Life Science lender, closed its fourth growth debt fund at €575 million, almost doubling the €297 million raised for Fund III in 2022. More here
ByteDance raised $30 billion from nearly 30 banks to help fund AI projects outside of China. The loan is the second-largest made in Asia this year after SoftBank raised $40 billion in March. Chinese, U.S., European and Singaporean banks are participating in the financing, the people said, with the three-year loan co-ordinated by Citigroup and JPMorgan. Link
Blue Owl opened a Zurich office to support its engagement with financial intermediaries in Switzerland, including private banks and wealth managers. It is Blue Owl’s eighth office in the EMEA region and its twenty-fourth globally. Link
Market Updates
Headline vs Reality…
Non-investment-grade credit has a 3% default rate. The private non-investment world is $1.8 trillion
That means $50 billion of defaults. There will be defaults.
I remember reading this quote earlier in the year, and it reframed how I think about defaults. We should expect defaults; they’re the reason credit carries a spread.
It’s also changed how much weight I give to headlines about defaults. Last week, Bathla, an Australian real estate developer, became the latest private credit default to attract global attention.
Here are three reasons I think the story needs some perspective:
Bathla isn’t one of Australia’s largest developers. It didn’t make the Housing Industry Association’s top 20.
The headline debt number needs context. Bathla owes A$3.4 billion, less than 1% of Australian banks’ A$500 billion of commercial-property exposure.
Australia sounds like a large market, but its CRE market is roughly the size of Florida’s.
Strip away the headlines, and you have a mid-sized developer, a manageable debt pile, and a relatively small market.
Partnership Updates
MUFG Group and BlackRock entered into discussions to partner in Japan-related private credit opportunities. The discussions will cover areas including the evaluation and sourcing of, and investment in, Japan’s private credit market. Link
Mubadala Capital received a $500 million commitment from Alpha Dhabi, a UAE-listed investment holding company. Under the revised partnership agreement, Alpha Dhabi will double its capital commitment to $1 billion and increase its ownership interest in its joint venture, MICAD Credit JV, to 40%. Link
“Today, the hardest part of investing is to know what professional services are going to be worth.
What is a billable hour?”
BDC Redemptions Update
If you missed the BDC redemption update for Q2 26, below is a summary:
Investors asked to withdraw ~$24bn across the 15 non-traded BDC funds we track
Managers met ~$8bn of the requests.
Median requests were ~10% of NAV.
All managers capped the redemptions at 5%.
Read the full update here.
Q3 26 Update: Week 1
Last week saw the first wave of redemption announcements:
Redemption requests have fallen for all managers so far.
Cliffwater’s redemption requests w
Golub received redemption requests lower than its cap
All other managers capped payouts at 5%.
💰Fundraising News
Claret Capital’s $670 million European Growth Debt Fund
Claret Capital, a London-based manager, announced the final close of its Fund IV, exceeding its €500 million target and almost doubling the €297 million raised for Fund III in 2022. The fund invests in technology and life science businesses across Europe and globally.
Arcmont’s $505 million European Direct Lending Fund
Arcmont, a London-based private credit manager, raised A$705 million ($505 million) from four Australian institutional investors for its European direct lending strategy. The strategy lends to European mid-market companies through senior secured, unitranche, and subordinated loans.
BNP Paribas’ $600 million SRT Mandate
BNP Paribas Asset Management secured a $600 million significant risk transfer mandate from the Arizona State Retirement System, taking the pension fund’s total commitment to BNP’s SRT strategy to $1 billion.
This newsletter is for educational and entertainment purposes only. It should not be taken as investment advice.