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HPS Corporate Lending Fund Launches $400 Million Private Placement Offering to Support Operations

HPS Corporate Lending Fund, a perpetual-life non-traded business development company sponsored by HPS Investment Partners LLC, priced an offering of $400 million in aggregate principal amount of its 6.25% notes due 2029 in a private placement to institutional buyers.

The notes will mature on Sept. 30, 2029, and may be redeemed in whole or in part at the BDC’s option at any time prior to Aug. 30, 2029 at par value plus a “make-whole” premium and at par value on or thereafter. The offering is expected to close on June 18, 2024, subject to customary closing conditions.

The BDC said it expects to use the net proceeds of the offering to make investments in accordance with its investment strategy and policies, to reduce borrowings and repay indebtedness incurred under various financing agreements the fund has entered into, and for general corporate purposes of the fund and its subsidiaries.

According to prior reporting by The DI Wire on the results of the Stanger NL BDC Total Return Index – which measures the performance of non-listed business development companies on a quarterly basis – HPS Corporate Lending Fund led non-listed BDCs in both the three-month and one-year total return in the first quarter of 2024, with a total return of 3.8% and 16.3%, respectively.

As of April 30, 2024, the BDC’s aggregate net asset value was $6.53 billion, approximately a 73% year-over-year increase from $3.77 billion in April 2023; the fair value of its investment portfolio was $10.1 billion, approximately a 47% year-over-year increase from $6.87 billion in April 2023; and it had principal debt outstanding of $3.9 billion, resulting in a debt-to-equity ratio of approximately 0.60 times.

HPS Corporate Lending Fund was formed to invest primarily in newly originated senior secured debt and other securities of private U.S. companies within the middle market and upper-middle market. The fund launched in late January 2022 and seeks to raise $4 billion.

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