PennantPark Closes $745M Private Credit Continuation Vehicle

PennantPark Investment Advisers has closed a $745 million private credit continuation vehicle led by Pantheon, giving investors in several legacy funds a liquidity option while allowing PennantPark to continue managing a seasoned portfolio of middle-market loans.

PennantPark Credit Secondary Fund, or PCS, acquired a diversified portfolio of mature private credit investments across service-oriented industries that the manager considers resilient through economic cycles. The oversubscribed transaction also attracted commitments from PGIM, PennantPark and limited partners that elected to reinvest.

PCS includes additional unfunded capital to support follow-on financings for existing borrowers and potential new investments. That capital gives the manager flexibility to protect or expand positions without depending solely on loan repayments or asset sales.

Continuation vehicles are becoming a larger part of private credit secondaries as managers seek alternatives to selling loans individually and institutional investors look for liquidity from otherwise illiquid holdings. Private credit secondary transaction volume exceeded $12 billion in 2024, up from approximately $9.8 billion in 2023, according to Campbell Lutyens data.

“This transaction affirms our view that the core middle market provides a superior risk-adjusted investment opportunity for those seeking diversification within their private credit portfolios,” PennantPark founder and Managing Partner Art Penn said.

Rakesh “Rick” Jain, partner and global head of private credit at Pantheon, said the deal reflects Pantheon’s focus on collaborative, manager-led liquidity solutions capable of addressing complex portfolio needs.

Pantheon’s role as lead investor expands a relationship with PennantPark that spans multiple funds.

Evercore served as financial adviser to PennantPark on the transaction. Kirkland & Ellis LLP acted as legal counsel for PennantPark.