Private Equity Firms Storm Leveraged Loan Market to Fund Payouts

Private equity firms are rushing to the leveraged loan market to line their pockets, pushing aggressive deals to fund payouts in a space that’s thin on new supply.

Five deals are underway to fund shareholder dividends, accounting for half of this week’s volume, and the most in a week since 2017, according to data compiled by Bloomberg. Sponsors are bringing the deals at a time when there’s not much else to buy and secondary loan prices are rallying, despite continued weeks of outflows.

The private equity firms are piling more debt onto their portfolio companies -- many of ...