Add-On Acquisition

Private Credit Glossary

A bolt-on acquisition by a sponsor's existing portfolio company — typically funded via a delayed-draw tranche or the accordion (incremental facility) under the existing credit agreement, subject to pro forma covenant compliance. Lender benefits include a larger and more diversified borrower, often-lower pro forma leverage, and incremental origination fees; the structure is preferred over a full refinancing because it preserves the existing covenant package.

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