Good Morning Everyone

Welcome to your weekly Growth Cap/ABL market update. I’m breaking down the biggest deals and revealing the lending criteria and insights driving them. My goal today is to provide you with value, whether it’s a new lender to connect to, an idea/strategy to execute, or a location to look for more/better deals. Let me know if you have any lender-specific questions or requests.

🏢 Domestic & Global Deals
📈 Interest Rate Outlook
🚧 Addressing Challenges
⚖️ Regulatory Watch
🔮 Future Outlook
🏆 Winners & Losers
🔦 Deal Spotlights
👤 Lender Profiles
🤝 Location Opportunities
💡 Alpha Trends


Let’s dive in.

Bridge Loan Guy
Top Loans of the Week

Largest US loan deal: $3.4 billion term loan to Consumer Cellular (HPS/Blackstone-led)

Largest Global loan deal: SoftBank's $15 billion loan for AI investments by a 21 bank consortium led by Mizuho, SMBC, and JPMorgan.

TOP GROWTH-CAP/ABL DEALS

Domestic Market
◾ HPS/Blackstone/PSP Provide $3.4B to Consumer Cellular for Dividend Recap - Link
◾ Anthropic Secures $2.5B Credit Line from Morgan Stanley/Barclays/Citibank/JP Morgan as AI Race Accelerates - Link
◾ Truist/JPM/BBVA/BOA Provide $1.61B Credit Facility to Lennar Corporation - Link
◾ UMB Bank Leads $220M Credit Facility for DBM Global's Expansion Plans - Link
◾ BlackRock Provides $200M Term Loan to Yext for Strategic Acquisitions - Link
◾ First Citizens Bank Delivers $50M Financing to Space Leasing International - Link
◾ Aequum Capital's $35M Revolving Credit Line Rescues Midwest Commodity Distributor - Link
◾ Amerisource Closes $30M ABL Facility for Midstream Energy Infrastructure Company - Link
◾ o15 Capital Partners provides $28M loan to Simplify Compliance Holdings - Link
◾ Gordon Brothers Backs Carroll Fulmer Logistics with $27M Senior Loan - Link

Global Market
◾ Mizuho/SMBC/JPMorgan $15B for SoftBank's AI empire expansion – Link
◾ Commerzbank/Erste/Raiffeisen €545M for Lenzing's fiber future – Link
◾ DBS $150M for Adani Ports' comeback capex push – Link
◾ Arkéa Banque/Bpifrance €108M for Chargeurs' luxury brand strategy – Link
◾ Liquidity €75M+ for Butternut Box's Polish dog food factory – Link

INTEREST RATE OUTLOOK

The Federal Reserve's maintenance of the 4.25%-4.50% target rate range amid persistent inflation concerns is creating significant headwinds for Growth Capital and ABL markets. Despite market expectations of potential rate cuts later in 2025, the Fed's cautious stance and tariff-induced inflation have pushed long-term yields above 5%. This "higher for longer" environment is forcing lenders to adjust pricing models, with private credit spreads widening to 500-600 bps over SOFR for senior debt. For borrowers, this translates to substantially higher financing costs and more stringent underwriting standards, particularly affecting middle-market companies with near-term refinancing needs.

ADDRESSING CHALLENGES

Manufacturing companies across the Midwest face a perfect storm of tariff-induced cost inflation and tightening credit conditions that directly impact both Growth Capital and ABL markets. Small business optimism declined to 95.8 in April 2025, with only 18% planning capital expenditures—the lowest level since COVID—while manufacturers report 68.4% expect input costs to rise over six months due to tariffs. This creates a challenging environment for ABL lenders as borrowing bases shrink due to inventory devaluation and slower receivables turnover, while Growth Capital opportunities diminish as potential targets delay expansion plans and focus on cost management rather than growth initiatives.

REGULATORY WATCH

The evolving antitrust landscape under the new administration's "America First" approach is creating both opportunities and uncertainties for Growth Capital transactions, particularly in technology and healthcare sectors. New Hart-Scott-Rodino filing requirements are extending deal timelines for mid-market acquisitions, while potential changes to banking regulations could impact ABL availability as regional banks reassess their risk appetite for asset-based lending. The technology sector faces particular scrutiny for deals involving foreign investment or cross-border elements, forcing Growth Capital firms to build longer regulatory buffers into their investment timelines and potentially favoring domestic-focused transactions.

FUTURE OUTLOOK

Growth Capital deployment is expected to accelerate in Q3-Q4 2025, driven by AI infrastructure and healthcare innovation, while ABL markets face a bifurcated outlook based on sector fundamentals. Private equity firms sitting on $3 trillion in uncommitted capital face deployment pressure, creating opportunities as sponsors seek minority partners for portfolio growth. Private credit will maintain its dominance, though competition could compress spreads in favored sectors. U.S. trade policy volatility adds complexity, with the current tariff reprieve expiring in Q3. Technology, healthcare, and energy transition will attract premium terms, while cyclical industries face tighter conditions. Lenders with sector expertise and flexible strategies will be best positioned in this divergent landscape.

WINNERS AND LOSERS

DEAL SPOTLIGHT OF THE WEEK

$2.5B Anthropic Revolving Credit Line
◾ Structure: Five-year revolving credit facility
◾ Interest Rate: Estimated SOFR + 200-250 bps with commitment fee of 0.25-0.35% on undrawn amounts*
◾ Loan Term: Five years (confirmed in announcement)
◾ Industry: Artificial Intelligence
◾ Borrower Profile: Leading AI research company valued at $61.5 billion, with annualized revenue reaching $2 billion in Q1 2025 (doubled from previous quarter) ◾ Unique Feature: Seven major global banks participated in the facility: Morgan Stanley, Barclays, Citibank, Goldman Sachs, JPMorgan, Royal Bank of Canada, and Mitsubishi UFJ Financial Group
◾ Strategic Significance: This credit facility represents a strategic milestone in AI financing, providing Anthropic with significant liquidity flexibility amid an intensifying technology arms race. The revolving structure, rather than a term loan, suggests Anthropic values flexibility for opportunistic investments, talent acquisition, and computing infrastructure buildout. Unlike typical venture debt, this facility likely carries minimal financial covenants but may include change-of-control provisions and potentially cross-default triggers with other material obligations.

LENDER PROFILE OF THE WEEK

The Tech-Forward Venture Debt Specialist
◾ Focus: Growth capital and venture debt for institutional equity-backed companies across five business verticals: tech lending, equipment financing, life sciences, asset-based lending, and sponsor finance
◾ Interest Rate: SOFR + 500-800 bps (approximately 9.25%-12.34% based on current SOFR rates of 4.25%-4.34%)
◾ Geographic Scope: International platform with headquarters in Phoenix, Arizona, and strategic presence across the United States and London, UK
◾ Deal Size: $5M-$100M+ growth capital facilities
◾ Minimum Revenue: Growth-stage companies with expected annual revenues up to $100 million
◾ Industries: Tech, life sciences, medical devices, innovative sectors with venture capital backing
◾ Deal Structures: Term loans, equipment financings, working capital loans, plus equity-related investments and warrant coverage
◾ Key Differentiator: Publicly traded BDC with over $4.3 billion in fundings across 400+ investments and 21 consecutive quarters of stable/increased dividends

Let me know if you have a deal that fits this lender, and I will make an intro. EMAIL

◾ Austin's tech boom is creating a hotbed for FinTech companies, especially those that help other software companies add financial services.
◾ Memphis is already a logistics powerhouse thanks to FedEx's global hub, but now it's becoming the go-to place for companies solving our messy supply chain problems with technology.
◾ Pittsburgh is transforming from its steel town roots into a major tech hub focused on AI and robotics in manufacturing. What makes this especially interesting is that it's not just startups driving this change – established manufacturers are also investing heavily in AI upgrades.
◾ With the big push for energy independence, Phoenix is becoming a major hub for manufacturing solar panels, batteries, and wind components right here in the U.S. State incentives are driving a boom in solar manufacturing plants.
◾ Nashville's strong healthcare ecosystem is creating innovative telehealth solutions, especially for remote patient monitoring of chronic diseases. The city is seeing a surge in funded telehealth startups.
◾ California Central Valley’s agricultural heartland is perfect for asset-based lending, supporting mid-sized food processors and value-added agriculture. The region offers exceptional collateral quality in a recession-resistant sector.

⮞ Get our “blue-ocean” reports to help you uncover the best locations to close more deals EMAIL

💡ALPHA TRENDS

Lastly, no content provided by Bridge Loan Guy or Loans, Lenders & Leverage should be considered tax, investing, or financial advice. This email and any other content we provide are for entertainment and education purposes only. We do not claim to provide tax, investment, financial, or other legal advice. Any content provided by Bridge Loan Guy or Loans, Lenders & Leverage is the personal opinion of our owners and/or staff – you should always conduct your own research