First Eagle Nontraded BDC Cuts Payout to $0.19 as NAV Slips to $23.51

First Eagle Private Credit Fund reduced its monthly distribution to $0.19 per Class I share for October, down from the $0.21 it declared for each of the first nine months of 2026.

The October distribution, which is $0.185 per Class D share net of fees, is payable Nov. 27 to shareholders of record as of Oct. 30. The fund did not give a reason for the reduction, as of the time of publication.

The nontraded business development company’s net asset value per share fell to $23.51 as of Sept. 30, from $23.79 at June 30 and $24.23 at the end of 2025. Aggregate NAV declined to $292.2 million from $295.6 million at June 30 and $301.9 million at year-end 2025.

The portfolio also contracted. The fair value of the fund’s investments was approximately $526.5 million as of Sept. 30, down from $552.9 million at June 30 and $567.3 million at Dec. 31. Debt outstanding fell to $263.6 million from $278.6 million at June 30, bringing the fund’s debt-to-equity ratio to 0.90 times from 0.94 times. The weighted-average yield on the fund’s direct lending debt and income-producing investments was 9.64% at cost as of Sept. 30, the fund reported.

The reduction comes after the expiration of fee waivers that had lowered the fund’s costs; the fund’s advisers waived all management and incentive fees from June 2024 through June 2025, then 50% of the base management fee and all incentive fees through Dec. 31, 2025, as AltsWire reported when the waivers were extended. The advisers waived no fees in the first half of 2026, the fund reported. In the second quarter, total investment income fell to $14.1 million from $16.3 million a year earlier, net expenses including excise tax rose to $7.6 million from $7.4 million, and expense support from the adviser declined to $837,000 from $1.5 million.

One investment was on non-accrual at quarter-end: a second-lien loan to Alvogen Pharma US Inc., carried at $491,000 against $884,000 in principal.

In October, the fund’s lenders capped its exposure to software, IT services, and healthcare technology borrowers at 20% of the loans backing its $350 million credit facility, while cutting the facility’s borrowing spread by 30 basis points, AltsWire reported. Those three industries accounted for 12.69% of the portfolio at fair value as of June 30, the fund reported.

Unlike several larger nontraded BDCs that have prorated repurchases this year, First Eagle Private Credit Fund has seen little demand for liquidity. No shares were tendered in either its second-quarter offer, which expired May 29, or its third-quarter offer, which expired Aug. 31, the fund reported. In the first quarter, shareholders tendered 40,500 shares, all of which the fund accepted, for about $970,000.

The fund opened its fourth-quarter tender offer Oct. 30 for up to 621,572 shares, or about 5% of the 12.4 million shares outstanding as of Sept. 30. The offer expires Nov. 30, and accepted shares will be repurchased at the Dec. 31 NAV. FEPCF Founders Fund L.P., an affiliate of the fund’s adviser, held 8.3 million shares, or 66.8% of shares outstanding, and does not intend to tender, the fund said.

The fund continues to raise capital through its private offering, selling 416,844 Class I shares for $9.8 million to a feeder vehicle on Oct. 1. It has raised $314.2 million across its public and private offerings since inception.

The distribution cut also comes ahead of a change in ownership at the fund’s adviser. Victory Capital Holdings Inc. (Nasdaq: VCTR) agreed in August to acquire First Eagle Investments for approximately $7 billion, a transaction that will automatically terminate the fund’s advisory and subadvisory agreements at closing and require board and shareholder approval of new ones. The deal is expected to close by the end of the first quarter of 2027, Victory said.

First Eagle Private Credit Fund is a nontraded BDC advised by First Eagle Investment Management LLC and subadvised by First Eagle Alternative Credit LLC, investing primarily in private credit to U.S. middle-market companies.

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