Private Credit

Credit funds of all types are a very significant part of Dechert’s practice, encompassing liquid credit, hybrid and less liquid private-equity-style credit strategies, including direct lending, mezzanine, distressed and special situation funds. We work with clients to structure credit funds across the globe with a careful eye on tax, regulatory and compliance, marketing and ESG concerns. Dechert was the first and is the leading law firm with a funds practice in the five principal European fund domiciles (the United Kingdom, Ireland, Luxembourg, Germany and France) as well as the United States, the Middle East and Asia, so clients can rely on Dechert for truly “jurisdiction neutral” advice.

As one of the leading firms in private credit finance, we regularly advise the largest asset managers in the industry on the largest, most sophisticated financing transactions in the market. We represent 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 innovative transaction structures and leverage strategies, including asset-based facilities, structured financings, unsecured issuances, repos, and bespoke and esoteric products.

Dechert’s preeminent fund finance practice represents financial institutions, alternative lenders, asset managers and investment funds on a wide array of fund-related financings and loan transactions, including subscription facilities, NAV facilities, hybrid facilities and asset-backed loans. We handle all aspects of fund finance, including providing input on debt and leverage issues at inception and in connection with downstream structuring and lending transactions. Our team includes partners with leading practices acting for lenders and borrowers and we operate across all elements of the capital structure.

Dechert represents many of the world’s largest asset managers, including a substantial portion of PDI’s top 100 private debt funds, and other financial institutions on implementing direct lending strategies. These include bilateral, club and syndicated lending for private equity-backed buyouts, management buyouts, and other corporate and M&A transactions. Our global team represents lenders on 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 counsel on the full range of financing transactions from performing credit through to special situations lending and rescue financing.

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. We have a multidisciplinary team of lawyers who are 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.

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. Our team supports underwriters (major investment and commercial banks) as well as equity investors and some of the largest asset managers in the CLO space with respect to their most complex strategies. 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 and broadly syndicated arbitrage CLOs in the United States and Europe.

We advise asset managers, insurance companies and other financial services companies institutions seeking to grow their private credit capabilities through consolidation and strategic collaborations and have advised on countless mergers and acquisitions, and joint ventures, reorganizations and other strategic transactions in this space. Recognized as “Financial Services Law Firm of the Year” by The Deal for two consecutive years, Dechert regularly represents clients seeking to expand their product offerings, assets under management, or both, through innovative domestic and cross-border M&A and strategic transactions.

Our world renowned asset management practice, combined with our top-ranked M&A, private equity and finance capabilities, enables us to structure 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 fund clients operate.

We combine specialists in financial restructuring, global finance, capital markets, PE and regulatory matters to provide 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 restructuring solutions to protect investors and maximize returns and are involved at every stage of forming, negotiating and effecting a restructuring. We advise some of the leading distressed and other credit investors on in- and out-of-court financial and operational restructurings and workouts.

Our private credit capabilities form part of Dechert’s renowned alternative asset management practice. With private equity firms increasingly turning to private credit for financing, our extensive private equity experience ensures critical perspective.

Tax laws and regulations are more than just considerations; they often drive business strategy, structure, and deal consummation in the private credit space. Asset managers and the funds they manage (including business development companies, mutual funds and private funds), in addition to other financial institutions and their respective boards of directors/trustees, count on our global tax team to anticipate and resolve tax issues related to structuring funds, joint ventures, securitizations, novel financing structures and financial products and M&A transactions.

ESG is a growing and rapidly developing priority for investors, asset managers, portfolio companies and, increasingly, regulators. We provide sophisticated and practical advice on ESG-related trends and issues to private credit managers across the U.S., Europe, Asia and other jurisdictions from institutional investor level through to portfolio company practices, such as in relation to navigating the evolving ESG and sustainability-related regulatory landscape, designing ESG-related policies and procedures and sustainability-linked private credit financings.