Private credit lenders are in active discussions to provide a $1.3 billion loan to L Catterton for its Fullscript acquisition, after syndicated lenders declined to underwrite the deal.
The shift reflects a widening bifurcation in debt markets. Syndicated lenders—primarily banks and institutional investors—have pulled back from this credit, likely signaling higher perceived risk or uncompetitive terms relative to the risk-free rate and spread environment. Private credit funds, which hold debt on balance sheet rather than syndicating, can structure more flexible terms and move faster, though typically at higher yields.
For L Catterton, private credit execution ensures deal closure but comes with duration and liquidity trade-offs. The sponsor absorbs higher funding costs in exchange for certainty of close and bespoke covenant structures that would not clear in public markets.
