Private credit continuation deals hit $15bn in 2025. Read this to learn how it works

Private credit manager's new vehicle buys loans from their old fund. Existing fund LPs cash out; and private credit secondary funds come in as new LPs into continuation vehicle.

I said it a year ago - PC secondaries will be big in 2025. These loans financed PE LBOs and with lack of exits they can't be repaid.

Tenish years ago there was a lot of private credit lending in ZIRP. These credit funds are reaching end life and have to extend and (sometimes) pretend.

GP-led secondaries in PC are different vs PE, as the portfolio can have 200+ loans vs one/couple assets, so there isn't a concentration risk. At the same time how much DD can new investors do on 200 loans?

With typical 10 - 15% NAV discount + lower returns profile of private credit, LPs cashing out are not getting great returns, but at least they get liquidity.

Growth will continue with a lot of money raised for PC secondaries. Recently, Coller raised $6.8bn and Ares raised $7.1bn.