Private Credit Helps PE Peers by Making Deal Financing Portable

Private equity firms, eager to sell debt-laden businesses, are finding private credit firms increasingly willing to keep outstanding loans intact, even for companies that may soon have new owners.

The trend, known as portability, describes loans that remain essentially unchanged when a company gets new ownership. It carries rewards and risks for businesses and especially for lenders. Usually a change of control would allow lenders to renegotiate terms to cover potential risks from a new parent, such as different plans for growth or profitability of a business.

After two years of rising interest costs hindering asset sales, owners are seizing ...