First Eagle Private Credit Fund Declares First Regular Distribution
First Eagle Private Credit Fund, a recently launched, non-traded business development company, declared its first regular distribution of $0.21 per share payable to shareholders of record as of the open of business on Sept. 30, 2024. The distribution will be paid on or about Oct. 29, 2024.
The fund stated that these distributions will be paid in cash or reinvested in shares for shareholders participating in the fund’s distribution reinvestment plan. This is the fund’s first distribution declaration since going effective in June of this year.
First Eagle Private Credit Fund’s stated objectives are to generate returns in the form of current income and, to a lesser extent, long-term capital appreciation. The fund expects that the majority of its total assets will be in private credit investments to U.S. private companies, as it believes there is an opportunity to provide middle-market companies with bespoke lending solutions.
The fund is offering and selling its common shares in a continuous private placement and has registered a public offering with the U.S. Securities and Exchange Commission to sell up to $5 billion of common shares on a continuous basis, but will not commence a public offering until such offering has been registered in all of the necessary U.S. states and territories.
The fund pays a management fee monthly in arrears at an annual rate of 1.25% of the value of its net assets as of the beginning of the first calendar day of the applicable month. It also pays an incentive fee, which consists of two components. A portion of the incentive fee is based on a percentage of the fund’s income, and a portion is based on a percentage of the fund’s capital gains.
Additionally, the fund also reported an update on the asset mix of its investment portfolio at fair market value. The fund reported that its investment portfolio consisted of 21% direct lending, 18% club loans and 61% syndicated loans, as of June 30, 2024. As of the same date, the fair market value of asset-based lending investments represented 3.4% of the total fair market value of all investments.
For the direct lending portfolio, as of the end of June, the average spread was 5.97%, and the average earnings before interest, taxes, depreciation, and amortization was $20.8 million. The average loan-to-value was 34.2%, and the average company leverage was 3.4x.
The fund is managed by First Eagle Investment Management LLC, a private and independent asset management firm with a heritage that dates back to 1864. As of Sept. 30, 2024, First Eagle has nine global locations, including its New York headquarters, and has $149 billion in assets under management.