Blackstone Private Credit Fund, a non-traded business development company sponsored by private equity giant Blackstone (NYSE: BX), increased its regular monthly distribution from $0.1900 per share to $0.2100 per share, representing a 10.2% annualized distribution yield for Class I common shares based on the October NAV per share of $24.60.
For Class S common shares, would represent at estimated net distribution of $0.1926 and an estimated 9.4% distribution yield. For Class D Common Shares, would represent an estimated net distribution of $0.2049 and an estimated 10.0% distribution yield.
The company’s board of trustees approved the increase in distribution, which will become effective for the December 2022 monthly distribution and will be paid on or around Jan. 27, 2023.
This announcement comes after the Blackstone BDC’s regular monthly distribution increase from $0.1740 per share to $0.1900 per share for Class I common shares, announced on Sept. 7, 2022, and the recent special distribution of $0.07 paid in September 2022. (For Class S common shares, an increase from 0.1740 to 0.1900 per share and a special distribution of $0.07 paid in September 2022. For Class D common shares, an increase from $0.1740 to $0.1900 and a special distribution of $0.07 paid in September 2022.)
“These monthly distribution increases are driven by increases in [Blackstone Private Credit Fund’s] earnings power, which is positively impacted by rising interest rates, the quality of its portfolio, as well as widening spreads resulting from public credit market dislocation,” wrote the company in a filing with the SEC.
With nearly 100% of the company’s portfolio invested in floating rate debt, the company says it believes this creates an opportunity to increase regular distributions to align more appropriately with the BDC’s earnings power.
The DI Wire previously reported that as of Sept. 30, 2022, Blackstone Private Credit Fund had a lower monthly NAV per share. Each of the BDC’s shares had an NAV of $24.62 compared to $25.19 in August.
Blackstone Private Credit Fund is the industry’s first perpetual-life BDC and broke escrow on January 7, 2021. The fund is part of Blackstone Credit’s direct lending platform, which provides privately originated, senior secured, floating rate loans to U.S. and European middle market companies. Since inception, the BDC has raised nearly $28.0 billion of investor equity as of Sept. 30, 2022, according to data provided by Robert A. Stanger & Co.
As of Sept. 30. 2022, the fund’s aggregate NAV was $22.4 billion, the fair value of its investment portfolio was $49.0 billion, and it had $27.5 billion of debt outstanding (at principal). The average debt-to-equity leverage ratio during September 2022 was approximately 1.28 times.