In The Press November 15, 2022

Private Equity Funds Tap Exotic Loans for Liquidity as Deals Ebb (Bloomberg)

Private equity firms are increasingly turning to an unconventional type of debt to shore up portfolio companies as surging interest rates and declining valuations make it harder to sell assets, fund distributions, and raise money for new investments. So-called NAV loans, which allow firms to borrow against a pool of portfolio companies within a fund, are gaining in popularity. The debt can be attractive for private equity firms because it allows them to invest more cash in a portfolio company that, especially if it were struggling, would face higher financing costs on its own, said Kristopher Ring, a partner in the Debt Finance practice. Read more on Bloomberg.