In 2024, private credit continued its growth trajectory, solidifying its role as a key financing source in an evolving market. Rising interest rates and stricter bank regulations drove demand for private credit solutions, as businesses sought flexible, non-dilutive capital. Direct lending remained dominant, with private equity-backed companies and middle market borrowers leveraging customized debt structures. Unitranche loans gained popularity, offering streamlined financing for acquisitions and growth initiatives. Sectors like technology, healthcare and energy transition attracted significant private credit investment due to their resilience and high growth potential. ESG considerations also shaped the market, with lenders integrating sustainability-linked features into loan agreements. Despite economic headwinds, private credit maintained robust deal flow, providing tailored solutions to meet the diverse needs of borrowers.
Deal Spotlight: White Oak Commercial Finance
- Category: Private Credit
- Lender: White Oak Commercial Finance
- Deal Size: $120MM
- Borrower: Furniture Manufacturer
White Oak Commercial Finance Provides Liquidity and Flexibility for a Growing Manufacturer
White Oak Commercial Finance completed a transformative $120 million asset-based lending facility for a nearly century-old, family-owned furniture manufacturer. Seeking flexibility compared to their bank-led ABL arrangement, the borrower sought additional liquidity to fund capital investments and support high-growth business units. White Oak’s bespoke financing solution delivered just that — without the need for a syndication or additional third-party fixed asset lenders.
Kevin Cox, managing director and head of Capital Markets at White Oak, explained the unique challenges and opportunities this deal presented: “This was a great example of what we do best — unlocking value by digging deeper into a company’s balance sheet and really striving to get to know and understand the needs of our prospects and borrowers. Traditional banks often cannot lend beyond conforming advance rates against current assets, but we were able to provide significantly more liquidity by providing incremental advances against receivables and inventory, and add significant borrowing capacity against machinery & equipment, and unencumbered real estate.”
White Oak’s facility included incremental and stretch advances on working capital and fixed assets, some of which were not previously eligible under the bank facility. Additionally, its structure offered covenant flexibility, enabling the borrower to focus on manufacturing and sales without being constrained by rigid bank requirements. The ability to hold the entire $120 million commitment in-house also simplified execution and ensured faster closing.
“This deal underscores the growing demand for non-bank lenders to step in where traditional banks cannot,” Cox said. “By tailoring our approach and emphasizing speed and flexibility, we gave the company the runway needed to execute their strategic growth plan.”
