New Mountain BDC Sells $477M Portfolio to Coller
New Mountain Business Development Corp. has sold $477 million in assets to Coller Capital, a leading secondaries investor. The transaction is an example of a GP-led secondary, a structure used by sponsors to generate liquidity from illiquid assets and manage fund holding periods.
- The portfolio sold by New Mountain BDC consists of 15 positions, including loans to companies like Benevis, Dealer Tire, Alliance Animal Health, and iCIMS. This transaction will reduce New Mountain's exposure to seven of its ten largest holdings. - The assets were sold at 94% of their fair value as of December 31, 2025, representing a 6% discount. This discount is considered a "normal transaction discount for a large, concentrated block" of assets. The deal is expected to close in March 2026. - A significant portion of the sold portfolio included less liquid assets, with subordinated positions making up nearly 25% of the value and 37% of the assets generating payment-in-kind (PIK) income. Additionally, about one-third of the portfolio was composed of software-related companies. - For New Mountain, this sale is a strategic move to de-risk and diversify its portfolio, reduce its holdings of PIK-generating assets, and free up capital for new loans and stock buybacks. The company's net debt-to-equity ratio is expected to decrease from 1.21x to approximately 0.9x following the sale. - This transaction comes at a time of increased investor concern about the private credit market, with some analysts predicting a rise in default rates, partly due to potential disruption from artificial intelligence. - Coller Capital, the acquirer, is a major player in the secondary market with approximately $50 billion in assets under management. The firm recently closed its largest fund, Coller International Partners IX, with $17 billion, and has been expanding its credit secondaries platform. - The GP-led secondary market, where this deal is situated, has seen substantial growth, accounting for nearly half of the overall secondary market, which hit a record $226 billion in 2025. This growth is driven by private equity sponsors seeking liquidity for their limited partners and tools to manage fund lifecycles. - In a related move, New Mountain Capital recently hired a managing director from Coller Capital to help build out its own new secondaries business, which will focus on single-asset continuation funds.
