Private Credit Rolls Loans Into New Funds to Repay Investors (1)

Private credit firms are flooding the market with continuation funds, as a lack of mergers and acquisitions, a fundraising drought and US tariff-induced volatility force them to find other ways to return cash to investors.

These vehicles are a type of secondary transaction, once reserved for private equity firms that needed to hold on to their investments longer. Managers can roll over an existing portfolio of assets into a new fund with new investors. Existing limited partners can cash out without waiting for loans to be paid off or refinanced.

More of these funds are expected to crop up, as ...