March 26 (Reuters) - A majority of listed business development companies (BDCs) that lend to private companies are trading below their net asset values, according to LSEG data, as concerns over transparency, portfolio valuations and liquidity weigh on shares.
The data showed Ares Capital Corporation ARCC.OQ and Blackstone Secured Lending Fund BXSL.N were trading at about a 10% discount to net asset value, while Blue Owl Capital Corporation OBDC.N sat at a roughly 25% discount.
BDCs raise money from institutional and retail investors to lend to mid-sized companies, typically through illiquid loans that cannot be easily sold.
Investors have pulled billions of dollars from such vehicles in recent months on concerns over liquidity and as they assess how artificial intelligence could reshape enterprise software business models, a sector heavily financed by private credit funds.
Ares Management capped withdrawals at its private credit fund after investors sought to redeem 11.6% of shares, limiting redemptions to 5%, mirroring moves by Apollo Global Management and BlackRock, while Blackstone bought back more than the cap.
Most BDCs trade below net asset value https://reut.rs/40R2XYI
Dividend per share and net debt of major BDCs https://reut.rs/4uP5foS
Alts stock performance in past 12 months https://reut.rs/4d7Ohfa
(Reporting By Patturaja Murugaboopathy in Bengaluru. Editing by Vidya Ranganathan and Mark Potter)
((patturaja.muruga@thomsonreuters.com;))
Comments