The proportion of equity in private credit deals fell to 47% in 2024 from 49% the year before, law firm Proskauer Rose’s annual private credit report showed.
The five-year average equity in deals was 46%. Proskauer’s report is based on an analysis of data from about 440 deals, including 144 private equity-backed transactions with a total deal value of $101.7 billion.
More than a third of the private credit loans (35%) were to companies with at least $50 million in earnings before interest, taxes, depreciation and amortization. Twenty-nine percent of the loans were to companies with $15 million to $29.9 million EBITDA, 23% were to companies with $30 million to $49.9 million in EBITDA and 13% were for companies with less than $15 million in EBITDA, the report said.
We saw a marked shift in deal terms this year, with many terms becoming more borrower favorable,” said Stephen A. Boyko, a private credit partner at Proskauer, in a news release.
Fifteen percent of the private credit transactions studied were covenant-lite, with the majority of those being larger companies with more than $50 million in EBITDA, the study found.
