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Unitranche: Integrity Marketing loan highlights better pricing for direct lenders

Posted by Kelly Thompson, Direct Lending Deals on Sep 17, 2019 9:04:55 AM

The $945M financing for Integrity Marketing that was put away quickly and quietly last month not only shows how direct lenders continue to log wins for larger mandates, but also the wider premiums they earn bypassing the syndicated market. 

Pricing on the unitranche loan that Owl Rock Capital, Crescent Capital and Antares Capital put together for the company closed at L+575, according to sources. That's 150 bps higher than the L+425 on the insurance broker’s previous first-lien debt. It's also well above current averages in the more broadly syndicated market. 

According to S&P Global LCD, the average all-in yield is 5.9% across large borrowers this month. With 3-month Libor at 2.14%, that puts the average spread at roughly L+375 for syndicated issuers.

Against other unitranche loans — the tool of choice for many direct lenders —the Integrity Marketing credit is right in the wheelhouse of where the majority of unitranches have priced in 2019, based on data provided by Advantage Data.

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Topics: Loans, Middle Market, BDC, First Lien, debt, business development company, Non-accruals, portfolio, Direct Lending, syndicated, underperformers, Direct Lending Deals

Harvest Partners hit direct lending market for $945M unitranche loan at L+575 to support Integrity Marketing deal: Owl Rock, Crescent, Antares

Posted by Kelly Thompson, Direct Lending Deals on Sep 16, 2019 3:00:00 PM

Harvest Partners went with Owl Rock Capital, Crescent Capital and Antares Capital last month for $945 million in unitranche financing in connection with the private equity firm’s minority growth investment in Integrity Marketing Group, a national life and health insurance broker.

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Topics: Middle Market, BDC, debt, business development company, Non-accruals, portfolio, Direct Lending, underperformers, Direct Lending Deals

Non-Accruals PART II: What about lower middle market defaults? Higher, but even harder to assess

Posted by Kelly Thompson, Direct Lending Deals on Sep 11, 2019 3:34:52 PM

Last week’s look at BDC non-accruals showed an overall rate that still ran below historical norms, but what about the lower middle market? All BDCs invest in these names —that’s the nature of the business— but some drill down more than others.

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Topics: BDC, debt, business development company, Non-accruals, portfolio, Direct Lending, underperformers, Direct Lending Deals

BDC portfolios show little pain in non-accruals for 2Q19, steady ahead

Posted by Kelly Thompson, Direct Lending Deals on Sep 5, 2019 8:59:00 AM

Macro economic factors — tariffs on Chinese goods, political unrest in Hong Kong and Brexit among them — have returned volatility to capital markets, however direct lending has plowed onward with few upsets. 

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Topics: BDC, debt, business development company, Non-accruals, portfolio, Direct Lending, underperformers, Direct Lending Deals

One Step Ahead: Identifying Distress In The Middle Market

Posted by Alex Buzby on Nov 28, 2018 11:31:34 AM

Analyzing PIK and Coupon Spread changes can be a great way to identify middle market companies that are beginning to feel pressure from lenders.  Whether you're sourcing investments, consulting distressed borrowers or analyzing BDCs, utilizing alternative signs of distress as leading indicators is a great way to get ahead of the market - Download the data sample below!

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Topics: Middle Market, BDC, Spreads, First Lien, Distressed Investments, debt, business development company, Distress, Distressed Debt, Finance, Restructuring, Fixed Income, download


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