Sureserve’s debt could stay in the private credit market, according to 9fin sources, despite pre-marketing a syndicated loan deal last month.

Goldman Sachs and Jefferies had wall-crossed investors on a roughly €400m TLB back in March, as 9fin reported at the time. Funds would have refinanced Sureserve’s existing private credit debt and supported a recap to sponsor Cap10.

But a choppy primary market meant investors weren’t keen to swallow a recap for a debut issuer, 9fin sources added. And without the recap, the deal was too small for the syndicated markets.

The company, which provides energy and compliance services for the UK social housing sector, has existing private credit debt at S+600bps from Pemberton backing Cap10’s 2023 take private. The deal was financed by Pemberton’s Senior Loan Fund.

Dislocation in the syndicated markets in recent weeks has opened up opportunities for direct lenders. Karo Healthcare, for one, opted for a unitranche solution in the face of uncertain outcomes for liquid deals.

But it also means direct lending issuers that are only on the cusp of being palatable for large cap investors — as two investors describe Sureserve — may have missed their window to slash financing costs in the cheaper syndicated market.

Sureserve, Jefferies, Goldman Sachs, and Pemberton declined to comment. Cap10 did not respond to a request for comment.

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