Taking the Credit — Margin spreads and losing our heads


Market Wrap

Taking the Credit — Margin spreads and losing our heads

Josie Shillito's avatar
Synne Johnsson's avatar
  1. Josie Shillito
  2. +Synne Johnsson
4 min read

Large-cap private credit funds are repricing as many of their deals as possible at the request of their sponsors, and the squeeze is felt all the way down into the lower mid-market, according to 9fin sources.

This week, 9fin reported the private debt repricing of Silverlake-owned Italian tech platform Facile, down by 100bps. More details on the debt package and final pricing available for 9fin clients here. However, Facile is by no means alone. Large-cap private credit funds (focusing on deals over €50m EBITDA) polled by 9fin are spending much of their time on this activity, and, interestingly, prices are creeping down to a four handle.

“We were super busy with repricings in January,” said one direct lender at a large-cap private credit fund. “In one instance, we’ve repriced from mid 500bps [over the base rate] to mid 400bps. However in some other cases, we have gone as low as 400bps.”

9fin’s graphic, below, shows the downwards slope of both private credit and BSL pricing from Q1 2023 to present.

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