Ares Strategic Income BDC Pays $515M in Q3 Tender as Share Sales Slide

Ares Strategic Income Fund accepted 38.2% of the shares tendered in its third-quarter repurchase offer, paying about $515.1 million to shareholders, as net assets fell to $9.92 billion as of Sept. 30 from $10.21 billion as of June 30.Nov. 6.

Shareholders tendered about 50.4 million shares, or about 13.1% of shares outstanding, worth about $1.35 billion at the nontraded business development company’s Aug. 31 net asset value. The fund accepted about 19.3 million shares, or 5% of shares outstanding as of July 31, on a pro rata basis after giving priority to odd lots, and paid $26.74 per share, less any early repurchase deduction. The fund filled 43.1% of requests in the first quarter and 34.7% in the second quarter, when requests reached 14.4% of shares outstanding.

Share sales totaled about $165.4 million during the quarter, down from about $1.74 billion a year earlier, against $515.1 million of repurchases. Class I shares accounted for $126.5 million of sales, Class S shares $20.9 million, and Class D shares $18 million.

NAV per share was $26.69 for each class as of Sept. 30, compared with $26.71 as of June 30 and $27.48 at the end of 2025. The fund reported annualized distribution rates as of Sept. 30 of 9.64% for Class I shares, 9.39% for Class D shares, and 8.79% for Class S shares.

Net investment income was $219 million in the third quarter, down about 13% from $251.9 million in the second quarter, even as total investment income rose to $521.4 million from $499 million. Interest and credit facility fees increased to $181.9 million from $169.8 million. The fund declared $242 million in distributions during the quarter, more than its net investment income.

Payment-in-kind income made up 7.2% of total investment income in the third quarter, down from 8.3% in the second quarter but up from 6.2% a year earlier.

The portfolio’s fair value declined to $21.36 billion from $21.84 billion, spread across 795 portfolio companies. Loans on nonaccrual status represented 0.4% of total investments at amortized cost, or 0.2% at fair value, as of Sept. 30; none were on nonaccrual at the end of 2025. The fund reported a debt-to-equity ratio of 1.24 times as of Sept. 30, or 1.19 times net of about $463 million of available cash, and about $3.8 billion of undrawn capacity under its credit facilities. It expanded its credit facility to $4.1 billion in May.

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