Private Credit

• Fund Formation – We work with our clients to determine the most appropriate fund structures. Dechert clients benefit from our global knowledge of private credit and where it’s headed, including the current state of fund terms, market trends and structural innovations gained by launching numerous funds per year. Private credit fund structuring often requires careful navigation with a close eye on tax, regulatory and compliance, marketing and ESG concerns, particularly when customizing for a global investor base. We represent credit funds of all types, encompassing liquid credit, hybrid and less liquid private-equity-style credit strategies, including direct lending, mezzanine, distressed, special situation, private credit secondaries and CLO captive equity funds, as well as investment funds tailored for investment into structured products.
• Permanent Capital – Dechert’s experience with permanent capital dates back to the 1980 legislation that created business development companies (BDCs) and exempted them from some of the 1940 Act’s more onerous restrictions. Our multidisciplinary team is actively engaged in all aspects of the representation of alternative investment platforms and investment management companies, including public and private BDCs, ELTIFs, closed-end funds, interval funds, and other permanent capital vehicles and can guide clients through legal and business trends and developments as well as the regulatory hurdles and market terms.

• Structured Finance – The most prolific CLO players turn to Dechert as counsel in connection with the formation, operation and compliance of CLO platforms as well as risk retention capital formation strategies and private credit solutions. We are a trusted adviser to some of the largest asset managers with respect to their most complex structured credit/CLO strategies as well as supporting underwriters and equity investors. We lead the market in the representation of issuers, placement agents, collateral managers and equity investors in CLO transactions, including middle-market balance sheet CLOs, private loan securitizations and broadly syndicated arbitrage CLOs in the U.S. and Europe. Drawing on the combined experience of our fund formation and structured products teams, our lawyers are uniquely placed to advise managers and borrowers on a variety of fund financing structures, including Collateralized Fund Obligations (CFOs) and rated feeders. Dechert also represents asset managers and their lenders in leverage strategies for private credit funds, including asset-backed lending facilities, bankruptcy-remote financings, CLO warehouse facilities, bond issuances, repurchase facilities and other bespoke financings. We pride ourselves on being a solutions provider for our clients, particularly in transactions that are market firsts or require creativity.
• Fund Leverage ‒ As we regularly advise the largest private credit market participants on the most sophisticated transaction structures and leverage strategies in the market, we are able to guide clients through the most appropriate financing solutions. We advise asset managers and their lenders in loans to private credit funds to finance investments in middle market and broadly syndicated corporate loans. Our team has expertise in a wide range of established and newer solutions, including asset-based facilities, structured financings, unsecured issuances, repos, and bespoke and esoteric products.
• Fund Finance ‒ We can help with a wide array of fund-related financing including subscription facilities, NAV facilities, hybrid facilities and asset-backed loans. We deliver on all aspects of fund finance for financial institutions, alternative lenders, asset managers and investment funds, including providing input on debt and leverage issues at the time of fund formation and in connection with downstream structuring and transactions. We deliver effective deal structuring and execution, drawing on a deep understanding of fund structures and the financing options available to fund entities.
• Direct Lending ‒ We support lenders across all layers of the capital structure, including unitranche, senior credit facilities, first lien/second lien financings, mezzanine financing, Holdco PIK financing, equity and preferred equity.  We advise on the full range of financing transactions from performing credit through to special situations lending and rescue financing and on the implementation of direct lending strategies including bilateral, club and syndicated lending for private equity-backed buyouts, management buyouts, and other corporate and M&A transactions. Overall, we can provide insight into the latest terms and current state of the market to support your business objectives.
• Asset-based Finance –  As private credit managers increasingly look to the collateral-based cash flows to either facilitate their financing requirements or as an investment to support a diverse portfolio mix, Dechert has the expertise to assist in the purchase and financing of a broad array of assets, including auto loans, unsecured consumer loans, mortgages, credit card receivables, solar-related receivables and esoteric assets.  We leverage our cross-disciplinary strength and commercial, innovative approach to provide efficient execution of our clients’ transactions.
• Special Situations and Restructuring ‒ Combining specialists in financial restructuring, global finance, capital markets, PE and regulatory matters we support clients through comprehensive, market-savvy advice on complex stressed, distressed and restructuring situations involving private credit. Our integrated approach helps clients navigate challenging economic, business, legal and regulatory issues at every stage of the private credit life cycle and across the capital stack. We work with clients to develop and implement liquidity solutions. Further, we advise some of the leading distressed funds and investment firms on in- and out-of-court financial and operational restructurings and workouts.

• M&A and Strategic Transactions – With private credit market consolidation and strategic collaborations expected to rise, we help develop and deliver financeable deals with a focus on speed-to-market execution, optimized deal structures and practical terms that address the specific risks associated with the regulatory environment in which our private credit clients operate. We have advised countless asset managers, insurance companies and other financial services institutions on M&A, and joint ventures, reorganizations and other strategic transactions and regularly represent clients seeking to expand their product offerings, AUM or both, through innovative domestic and cross-border transactions, calling on specialists from our world-renowned asset management, M&A, PE and finance capabilities. We also are at the forefront of the growing secondaries market, having advised on the world’s largest private credit secondaries transaction.

• We help private credit managers across the U.S., Europe, Asia and other jurisdictions from institutional investors to portfolio companies navigate the growing and rapidly developing ESG and sustainability-related regulatory landscape, designing ESG-related policies and procedures and sustainability-lined private credit financings.

Tax laws and regulations are more than just considerations; they often drive business strategy, structure, and deal consummation in the private credit space. With global tax  lawyers who are fully integrated into our private credit solutions, clients count on Dechert to anticipate and resolve tax issues related to structuring funds, joint ventures, securitizations, novel financing structures and financial products, and M&A transactions.