Vista Credit BDC Accepts All Tendered Shares as Redemption Demand Drops to 1.8%

Vista Credit Strategic Lending Corp. accepted every share tendered in its second-quarter repurchase offer as redemption demand fell to 1.8% of shares outstanding, a reversal from the prorated tender it faced three months earlier.

The nontraded business development company sponsored by Vista Equity Partners reported the results Wednesday. Stockholders validly tendered 873,766 shares out of the up to 2,401,541 the company had offered to repurchase – just 1.8% of shares outstanding as of June 30 – and Vista Credit accepted all of them without proration. The company paid tendering stockholders approximately $16.4 million on or about July 29, at a price of $19.13 per share, the net asset value as of the June 30 valuation date less any applicable early repurchase deduction.

The result marks a steep pullback in demand from three months earlier, when Vista Credit was oversubscribed for the first time and prorated at its standard 5% quarterly cap. At that time, the company accepted roughly 50% of the 4,910,882 shares tendered, repurchasing 2,437,464 shares for about $46.1 million.

Bloomberg reported in May, citing a person familiar with the matter, that a single institutional shareholder – Partners Capital, holding shares on behalf of a Swiss pension fund client – accounted for the bulk of that oversubscription by seeking to redeem its full position, and that the spike did not reflect broader retail-driven redemption pressure. Partners Capital held roughly 5.5 million shares, or about 18% of the company, at year-end, and its stake fell by approximately 1.4 million shares as of April 30, according to the report.

Vista Credit Partners, the company’s adviser, said the portfolio continues to perform well, pointing to its focus on enterprise software borrowers and its ability to assess AI-driven risks and opportunities in that sector. The adviser said the majority of the portfolio was deployed after 2024, following the initial wave of generative AI releases and the Federal Reserve’s rate hike cycle, a period it characterized as marked by more disciplined underwriting and lower leverage.

The tender results follow a report last week that Vista Credit had increased leverage by nearly 60% since March to fund portfolio growth to $2.2 billion, AltsWire reported. Ares Strategic Income Fund, which held a portfolio of $21.8 billion as of June 30, reported $12.2 billion of debt outstanding against $10.2 billion of aggregate NAV, or leverage of roughly 1.2x. Blue Owl Credit Income Corp. – which absorbed a record quarter of redemptions earlier this year – was running leverage of 0.84x as of May 31, below its disclosed target range of 0.90x to 1.25x. Vista Credit is now running leverage comparable to peers with portfolios roughly 10 times the size of its own.

Vista Equity Partners launched Vista Credit Partners in 2013 to expand into credit strategies focused on enterprise software, data, and technology-enabled businesses, building on the firm’s core private equity focus on software companies. Vista Credit Strategic Lending Corp. is the perpetual-life BDC through which Vista Credit Partners offers individual investors access to that strategy.

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