By Matt Tracy
May 7 (Reuters) – Asset manager Blackstone cut the value of its private credit fund Blackstone Secured Lending Fund in the first quarter, it said on Thursday.
Blackstone Secured Lending Fund’s net asset value (NAV) per share dropped 2.4% to $26.26 in the first quarter at fair value, according to its earnings disclosure.
Investors have taken a closer look at the portfolios of private credit funds known as business development companies, as advances in artificial intelligence threaten the business models of companies in the software sector.
Blackstone Secured Lending Fund had about 20% of its portfolio in software names at fair value, at the end of March, according to its quarterly report.
Its portfolio’s non-accrual rate, or the percentage of its loans that are well behind on interest payments, was just over 3% last quarter, it said.
Executives for the fund addressed the non-accrual rate on the earnings call on Thursday. The fund said its largest loan on non-accrual, to software firm Medallia, was making progress in restructuring and that Blackstone planned to invest new capital in the business with partners to delever its balance sheet and invest in new AI features.
The fund also declared a 77-cent dividend, in line with past quarters, it said.
It saw $450 million in repayments within its portfolio in the first quarter, while new investments totaled almost $325 million, it said.
(Reporting by Matt Tracy in Washington; Editing by Chizu Nomiyama and Emelia Sithole-Matarise)
