Valuation Dynamics in the Private Market Landscape

Kerstin Kubanek has a discussion with Nick Baldwin, Managing Director at Lincoln International, focusing on key topics in the private credit landscape. They delve into the stability of amendments and their significant impact on pricing, noting that price increases have decreased since late 2023 due to competitive lending and proactive refinancing. The conversation also covers the influence of 2021 market conditions and the role of PIK (Payment in Kind) in pricing strategies. Despite rising interest rates, private companies continue to perform well, maintaining low default rates. Lenders and sponsors are employing strategies such as amendments, equity infusions, and maturity extensions to manage liquidity and ensure portfolio health.