Crescent Capital Group LP, an alternative credit investment manager based in Century City, has launched its newest business development company: Crescent Private Credit Income Corp.
Crescent Capital Group’s $40 billion credit platform launched Crescent Capital BDC Inc. as an exchange-traded business development company two years ago, but its newest company won’t appear on the stock market.
Similar to a venture capital fund, Crescent Private Credit Income will invest in developing and financially distressed entities, liquidizing returns through a share-repurchase program. The business development company classification, a distinct registration with the Securities and Exchange Commission, broadens Crescent’s credit platform from its historically institutional base to individual, nonaccredited investor participation.
According to its SEC filing, Crescent Private Credit is incorporated in Maryland and began operations in May of this year. As of June 30, Crescent says it had investments at fair value of $28.5 million in middle-market companies.
Moving forward, the company intends to offer up to $2.5 billion in common stock, which offers investors access to a portfolio of debt securities and equity investments in companies with annual net income before net interest, tax depreciation and amortization of between $35 million and $120 million.
Amid tight capital market conditions, Crescent believes this new company taps into unmet needs.
“The growing demand for capital from middle-market borrowers has created an even greater need for flexible capital providers like Crescent,” Eric Hall and Ray Barrios, chief executive and president, respectively, of the new company, said in a statement. The company received a $150 million seed investment from Sun Life Capital Management, a subsidiary of the Canadian-based Sun Life Financial Inc. Crescent Capital Group sold 51% of its company to Sun Life for $336 million in 2021.
Shares of Crescent Private Credit Income were offered at $25 and are available to investors in 33 states. They are not available in California.
