Key Takeaways
- • Private credit lenders are increasingly offering financing solutions to large, listed corporates that previously relied on equity, bond, or bank loan markets, according to a Freshfields blog post dated July 30, 2025.
- • Freshfields cites three drivers for corporate demand: access to funding during volatile markets, willingness to underwrite complex company narratives, and bespoke terms such as delayed draw facilities and tailored amortisation.
- • McKinsey estimated the private credit asset class at approximately $2 trillion, with an addressable market of roughly $30 trillion in the US alone, per Freshfields.
- • Freshfields reports record private credit deal volumes in 2024 and says the lenders' interest in listed companies rests on scale opportunity, high-quality credit with stable returns, and attractive spread premiums.
Summary
Freshfields, the international law firm, says private credit providers are offering new financing solutions to corporates, a segment that is still relatively small but growing. Historically associated with sub-investment grade distressed lending and direct loans to privately owned middle-market companies, private credit has in recent years drawn increasing capital toward listed corporates. Freshfields says it worked on record deal volumes in 2024 and on transactions tailored to large, stable companies seeking alternatives to traditional bank and public bond financing.
Freshfields identifies three reasons corporates are turning to the sector. First, private credit has filled a void left by bank and bond markets retrenching amid geopolitical risk and volatility, offering capital with a longer return horizon. Second, providers are often willing to examine complicated group structures, corporate transactions, or companies under stress that would be harder to sell to bank or bond investors. Third, providers can offer bespoke terms, including delayed draw facilities, maturity and amortisation profiles linked to project timelines, and asset-backed facilities. Freshfields notes that deals are often written by one or a small group of lenders, which it says reduces execution risk and increases certainty for borrowers.
On the lender side, Freshfields cites McKinsey's estimate that the asset class was about $2 trillion, mainly in sub-investment grade loans, against an addressable market of approximately $30 trillion in the US alone. Diversification of capital sources, including significant inflows of retail and insurance money, is supporting growth. Some managers have deployed very large sums into single investment-grade transactions as part of high-grade capital solutions strategies. Freshfields adds that investors are drawn to large, established companies with strong balance sheets, which it says carry lower default risk and more predictable cash flows, and that stressed or complex situations offer spread premiums for added risk, illiquidity, and complexity.
Freshfields concludes that the market is poised for continued growth and that its increasing scale and sophistication signal a lasting shift in global corporate finance. The post is an advisory piece from the firm's corporate and private capital practice and does not disclose transaction-level figures.
Freshfields identifies three reasons corporates are turning to the sector. First, private credit has filled a void left by bank and bond markets retrenching amid geopolitical risk and volatility, offering capital with a longer return horizon. Second, providers are often willing to examine complicated group structures, corporate transactions, or companies under stress that would be harder to sell to bank or bond investors. Third, providers can offer bespoke terms, including delayed draw facilities, maturity and amortisation profiles linked to project timelines, and asset-backed facilities. Freshfields notes that deals are often written by one or a small group of lenders, which it says reduces execution risk and increases certainty for borrowers.
On the lender side, Freshfields cites McKinsey's estimate that the asset class was about $2 trillion, mainly in sub-investment grade loans, against an addressable market of approximately $30 trillion in the US alone. Diversification of capital sources, including significant inflows of retail and insurance money, is supporting growth. Some managers have deployed very large sums into single investment-grade transactions as part of high-grade capital solutions strategies. Freshfields adds that investors are drawn to large, established companies with strong balance sheets, which it says carry lower default risk and more predictable cash flows, and that stressed or complex situations offer spread premiums for added risk, illiquidity, and complexity.
Freshfields concludes that the market is poised for continued growth and that its increasing scale and sophistication signal a lasting shift in global corporate finance. The post is an advisory piece from the firm's corporate and private capital practice and does not disclose transaction-level figures.
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