v3.26.1
Fair Value Measurements
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
Fair Value Measurements

5. Fair Value Measurements

Assets and liabilities recorded at fair value are classified and disclosed based upon a fair value hierarchy as described below. The fair value hierarchy prioritizes and ranks the levels of observability of inputs used in measuring investments at fair value. The observability of inputs is impacted by multiple factors, including the type of investment and the characteristics specific to the investment. Investments with readily available quoted prices or for which fair value can be measured from quoted prices in active markets will generally have a higher degree of market price observability and a lesser degree of judgment applied in determining fair value. Levels are based on the lowest level of significant input to valuation. See further disclosure related to valuation in Note 2- Summary of Significant Accounting Policies.

The three-level hierarchy for fair value measurement is defined as follows:

Level 1 – price quotes (unadjusted) for identical assets or liabilities that are available in active markets to which the Company has access to at the measurement date. The Company classifies unrestricted securities listed in active markets as Level 1. The Company does not adjust the quoted price for these assets or liabilities, even in situations where the Company holds a large position and the sale of such position would likely deviate from the quoted price.

Level 2 – pricing inputs, other than quoted prices included within Level 1, which are directly or indirectly observable at the measurement date. This category includes quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in non-active markets (including actionable bids from third parties for privately held assets or liabilities), and observable inputs other than quoted prices such as yield curves and forward currency rates that are entered directly into valuation models to determine the value of derivative contracts or other assets or liabilities. The Company classifies swaps and forward foreign currency contracts with observable inputs as Level 2.

Level 3 – unobservable inputs for the asset or liability are used where there is little, if any, market activity for the asset or liability at the measurement date and is based upon the Adviser or third-party’s assessment of the assumptions that market participants would use in pricing the assets or liabilities. These investments include debt and equity investments in private or real estate companies or assets valued using the market and/or income approach and may involve pricing models whose inputs require significant judgment or estimation because of the absence of any meaningful current market data for identical or similar investments. The inputs in these valuations may include, but are not limited to, discount rates, interest rate volatility, recovery rates, multiple on invested capital ("MOIC") and market multiples, such as TEV/EBITDA multiples. Valuations based upon information from third parties, such as broker quotes and third-party valuation services, in consultation with management, which are based significantly on unobservable inputs or are otherwise not supportable as Level 2 inputs are classified as Level 3. Level 3 investments also include certain investments in affiliates whereby the underlying investments within the affiliated entities can be classified under Level 1, 2 or 3.

The following table presents the valuation of the Company’s investment portfolio at fair value by level within the fair value hierarchy as of June 30, 2026:

($ in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

First lien debt investments

 

$

—

 

 

$

261,145

 

 

$

1,623,107

 

 

$

1,884,252

 

Mezzanine debt investments

 

 

—

 

 

 

—

 

 

 

1,416

 

 

 

1,416

 

Equity investments

 

 

7,194

 

 

 

—

 

 

 

26,212

 

 

 

33,406

 

Foreign currency forward transactions

 

 

—

 

 

 

713

 

 

 

—

 

 

 

713

 

Cash equivalents

 

 

15,576

 

 

 

—

 

 

 

—

 

 

 

15,576

 

Total Assets and Liabilities at Fair Value

 

$

22,770

 

 

$

261,858

 

 

$

1,650,735

 

 

$

1,935,363

 

The following table presents the valuation of the Company’s investment portfolio at fair value by level within the fair value hierarchy as of December 31, 2025:

($ in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

First lien debt investments

 

$

—

 

 

$

325,853

 

 

$

1,146,863

 

 

$

1,472,716

 

Equity investments

 

 

—

 

 

 

—

 

 

 

16,140

 

 

 

16,140

 

Foreign currency forward transactions

 

 

—

 

 

 

167

 

 

 

—

 

 

 

167

 

Cash equivalents

 

 

87,000

 

 

 

—

 

 

 

—

 

 

 

87,000

 

Total Assets and Liabilities at Fair Value

 

$

87,000

 

 

$

326,020

 

 

$

1,163,003

 

 

$

1,576,023

 

 

The following tables present a roll forward of the amounts in the Consolidated Statement of Financial Condition of the Company’s investment portfolio for the periods presented, classified by the Company within Level 3 of the fair value hierarchy. When a determination is made to classify an investment within Level 3 of the fair value hierarchy, the determination is based upon the significance of the unobservable inputs to the overall fair value measurement.

The Level 3 gain/(loss) in the following tables is included as a component of net realized and unrealized gain/(loss) on investments in the Consolidated Statement of Operations for the three months ended June 30, 2026.

 

 

 

For the three months ended

 

 

 

June 30, 2026

 

($ in thousands)

 

First lien debt
investments

 

 

Mezzanine debt
investments

 

 

Equity
investments

 

 

Total

 

Fair value, March 31, 2026

 

$

1,389,756

 

 

$

1,416

 

 

$

25,784

 

 

$

1,416,956

 

Transfer out of Level 3

 

 

(9,918

)

 

 

—

 

 

 

—

 

 

 

(9,918

)

Purchases/Borrowings

 

 

310,120

 

 

 

—

 

 

 

11,954

 

 

 

322,074

 

Sales and Settlements/Paydowns

 

 

(72,194

)

 

 

—

 

 

 

(12,243

)

 

 

(84,437

)

Accretion of discount/amortization of premium and paid-in-kind interest

 

 

1,086

 

 

 

—

 

 

 

—

 

 

 

1,086

 

Total net realized and net change in unrealized gain/(loss) on investments

 

 

4,257

 

 

 

—

 

 

 

717

 

 

 

4,974

 

Fair value, June 30, 2026

 

$

1,623,107

 

 

$

1,416

 

 

$

26,212

 

 

$

1,650,735

 

The Level 3 gain/(loss) in the following tables is included as a component of net realized and unrealized gain/(loss) on investments in the Consolidated Statement of Operations for the six months ended June 30, 2026.

 

 

For the six months ended

 

 

 

June 30, 2026

 

($ in thousands)

 

First lien debt
investments

 

 

Mezzanine debt
investments

 

 

Equity
investments

 

 

Total

 

Fair value, December 31, 2025

 

$

1,146,863

 

 

$

—

 

 

$

16,140

 

 

$

1,163,003

 

Transfer in to Level 3

 

 

15,686

 

 

 

—

 

 

 

—

 

 

 

15,686

 

Transfer out of Level 3

 

 

(25,746

)

 

 

—

 

 

 

—

 

 

 

(25,746

)

Purchases/Borrowings

 

 

626,907

 

 

 

1,416

 

 

 

18,240

 

 

 

646,563

 

Sales and Settlements/Paydowns

 

 

(135,750

)

 

 

—

 

 

 

(12,243

)

 

 

(147,993

)

Accretion of discount/amortization of premium and paid-in-kind interest

 

 

2,141

 

 

 

—

 

 

 

—

 

 

 

2,141

 

Total net realized and unrealized gain/(loss) on investments

 

 

(6,994

)

 

 

—

 

 

 

4,075

 

 

 

(2,919

)

Fair value, June 30, 2026

 

$

1,623,107

 

 

$

1,416

 

 

$

26,212

 

 

$

1,650,735

 

 

The Level 3 gain/(loss) in the following tables is included as a component of net realized and unrealized gain/(loss) on investments in the Consolidated Statement of Operations for the three months ended June 30, 2025.

 

 

For the three months ended

 

 

 

June 30, 2025

 

($ in thousands)

 

First lien debt
investments

 

 

Equity
investments

 

 

Total

 

Fair value, March 31, 2025

 

$

893

 

 

$

198

 

 

$

1,091

 

Purchases/Borrowings

 

 

337,627

 

 

 

264

 

 

 

337,891

 

Sales and Settlements/Paydowns

 

 

(13,820

)

 

 

—

 

 

 

(13,820

)

Accretion of discount/amortization of premium and paid-in-kind interest

 

 

72

 

 

 

—

 

 

 

72

 

Total net realized and unrealized gain/(loss) on investments

 

 

419

 

 

 

45

 

 

 

464

 

Fair value, June 30, 2025

 

$

325,191

 

 

$

507

 

 

$

325,698

 

The Level 3 gain/(loss) in the following tables is included as a component of net realized and unrealized gain/(loss) on investments in the Consolidated Statement of Operations for the six months ended June 30, 2025.

 

 

For the six months ended

 

 

 

June 30, 2025

 

($ in thousands)

 

First lien debt
investments

 

 

Equity
investments

 

 

Total

 

Fair value, December 31, 2024

 

$

—

 

 

$

—

 

 

$

—

 

Purchases/Borrowings

 

 

338,514

 

 

 

355

 

 

 

338,869

 

Sales and Settlements/Paydowns

 

 

(13,823

)

 

 

—

 

 

 

(13,823

)

Accretion of discount/amortization of premium and paid-in-kind interest

 

 

73

 

 

 

—

 

 

 

73

 

Total net realized and unrealized gain/(loss) on investments

 

 

427

 

 

 

152

 

 

 

579

 

Fair value, June 30, 2025

 

$

325,191

 

 

$

507

 

 

$

325,698

 

The following tables present quantitative and qualitative information about the significant unobservable inputs used in determining the fair value of the Company’s Level 3 investments. The tables display the range of significant unobservable inputs used by valuation techniques for each Level 3 asset category. Certain inputs may not be significant inputs used in the valuation of all investments within the Level 3 asset category. Additionally, the range of such inputs presented in the tables may not be applicable to the valuation of each individual asset within a category. The categorization of assets in the below tables is determined by each individual asset’s valuation characteristics.

As of June 30, 2026 and December 31, 2025, all Level 3 investments, earlier displayed in the fair value measurement table, were included in the following tables.

Certain asset categories, fair value amounts, valuation techniques and significant unobservable inputs are disclosed in the table and represent investments held directly by the Company, it is not intended to be all inclusive. The asset categories presented within the table may be more disaggregated than the categories presented within the Consolidated Schedule of Investments in order to further describe the valuation characteristics and align with the fair value methods described herein.

As of June 30, 2026

Level 3 Asset Category

 

Fair Value2

 

 

Valuation Technique

 

Significant
Unobservable Inputs

 

Range of
Inputs

 

 

Weighted
Average1

 

First lien debt investments

 

$

1,404,783

 

 

Discounted Cash Flow

 

Discount Rate

 

8.5%-12.7%

 

 

10.6%

 

 

 

144,053

 

 

Black Derman Toy

 

Discount Rate

 

8.0%-10.1%

 

 

8.9%

 

 

 

 

 

 

 

Interest Rate Volatility

 

30.0%

 

 

30.0%

 

 

 

74,271

 

 

Broker Quotes

 

Broker Quotes

 

N/A

 

 

N/A

 

Mezzanine debt investment

 

$

1,416

 

 

Discounted Cash Flow

 

Discount Rate

 

18.4%

 

 

18.4%

 

Equity investments

 

$

17,555

 

 

Monte-Carlo Simulation

 

Comparable Company Quotes

 

$

108.43

 

 

$

108.43

 

 

 

 

 

 

 

Call Option Term

 

4 years

 

 

4 years

 

 

 

 

 

 

 

Drift

 

14.8%

 

 

14.8%

 

 

 

 

 

 

 

Volatility

 

65.1%

 

 

65.1%

 

 

 

8,164

 

 

Valuation Multiple

 

LTM EBITDA

 

5.3x-12.3x

 

 

7.3x

 

 

 

 

 

 

 

NCY EBITDA

 

9.8x

 

 

9.8x

 

 

 

 

 

 

 

Illiquidity Discount

 

10.0%

 

 

10.0%

 

 

 

493

 

 

Discounted Cash Flow

 

Discount Rate

 

10.3%

 

 

10.3%

 

Total Level 3 Assets and Liabilities

 

$

1,650,735

 

 

 

 

 

 

 

 

 

 

 

 

1Unobservable inputs were weighted by the relative fair value of these investments

2$ expressed in thousands

 

As of December 31, 2025

Level 3 Asset Category

 

Fair Value2

 

 

Valuation Technique

 

Significant
Unobservable Inputs

 

Range of
Inputs

 

 

Weighted
Average1

 

First lien debt investments

 

$

963,798

 

 

Discounted Cash Flow

 

Discount Rate

 

8.3%-25.4%

 

 

10.2%

 

 

 

 

 

 

 

Interest Rate Volatility

 

30.0%

 

 

30.0%

 

 

 

129,827

 

 

Broker Quotes

 

Broker Quotes

 

N/A

 

 

N/A

 

 

 

53,238

 

 

Transactional Value

 

Transaction Price

 

N/A

 

 

N/A

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity investments

 

$

14,925

 

 

Monte-Carlo Simulation

 

Comparable Company Quotes

 

$

137.15

 

 

$

137.15

 

 

 

 

 

 

 

Call Option Term

 

4 years

 

 

4 years

 

 

 

 

 

 

 

Drift

 

0.145

 

 

0.145

 

 

 

 

 

 

 

Volatility

 

82.5%

 

 

82.5%

 

 

 

717

 

 

Valuation Multiple

 

LTM EBITDA

 

7.3x-12.3x

 

 

8.3x

 

 

 

 

 

 

 

Illiquidity Discount

 

10.0%

 

 

10.0%

 

 

 

498

 

 

Discounted Cash Flow

 

Discount Rate

 

10.1%

 

 

10.1%

 

Total Level 3 Assets and Liabilities

 

$

1,163,003

 

 

 

 

 

 

 

 

 

 

 

 

1Unobservable inputs were weighted by the relative fair value of these investments

2$ expressed in thousands

As of June 30, 2026 and December 31, 2025, the majority of the investments purchased by the Company were purchased alongside other funds, accounts and clients managed by the Adviser or its affiliates pursuant to the conditions of the Co-Investment Exemptive Order, as applicable.