NAV BDC repurchase queues diverge as redemptions hit a record

Repurchase requests at the NAV BDCs moved in opposite directions in the latest quarter. AB Private Lending Fund drew none. Golub Capital Private Credit Fund's requests fell to 4.8% of shares outstanding. A quarter earlier they had been 8.5%. PGIM Private Credit Fund's requests climbed to roughly 3.8%. That figure had been 0.3% in the prior quarter. The three tender-offer filings, compiled by Stanger's Alt Street Journal from SEC documents, show how unevenly the pressure is landing inside the semi-liquid credit structure.

At the same time, the sector hit its own record. Non-listed BDCs raised $2.0 billion in the second quarter. That was the weakest quarterly total since late 2020. It was 82% below the year-earlier figure. Redemptions ran nearly three times new capital. The quarter ended with roughly $3.8 billion in net outflows. The first half closed with a $5.6 billion gap. Kevin T. Gannon, Stanger's chairman, says the sector's liquidity cycle has entered its 'most demanding' stage. He describes proration as balancing payouts against the investors who stay.

Amid the pressure, Fidelity Private Credit Co LLC completed its previously announced merger with Fidelity Private Credit Company II LLC and Fidelity Diversifying Solutions LLC. The surviving entity has been renamed Fidelity Private Credit Company LLC. The three-way combination folds three related private-placement BDC vehicles into a single fund.

Golub and PGIM both said they will fulfill 100% of requests this quarter. Golub covered just 59% of them last time. Fulfilling every request is how the funds prove the tender offer still works even with aggregate redemption demand at a record. Stanger calls early Q3 data too limited to judge whether pressure is easing. The next round of repurchase filings will show whether this split is a blip or the start of a trend.