Morgan Stanley’s North Haven BDC Prorates Q3 Tender at 43.8% as Demand Holds Above 11%
North Haven Private Income Fund LLC, the nontraded business development company advised by a Morgan Stanley subsidiary, will prorate its third-quarter tender offer for the third consecutive quarter after investors asked to redeem approximately 11.4% of units outstanding, more than double the fund’s 5% quarterly cap. The fund will repurchase 5% of units and fulfill roughly 43.8% of each request.
Units will be repurchased at net asset value per unit as of Sept. 30.
Demand eased marginally from the second quarter, when requests reached 11.6% of units and the fund prorated fulfillment at approximately 43%. Requests totaled 10.9% in the first quarter.
Morgan Stanley Private Credit said nearly two-thirds of the third-quarter requests came from unitholders whose requests had been prorated in the prior two offers. The manager said the composition and stabilization of request activity “may indicate the durability of the Company’s investor base.”
An investor who submitted a full tender request in each of the first three quarters of 2026 will have received more than 80% of the requested amount once the current repurchase settles, the fund said, describing the figure as a representative outcome rather than an actual aggregate result. The fund has repurchased units valued at approximately $479 million across the three repurchase periods ending Sept. 30.
After accounting for new subscriptions and distribution reinvestment, the estimated net impact of the third-quarter tender on NAV is approximately $101 million, or about 3.2% of the fund’s NAV at June 30. The comparable second-quarter estimate was approximately $102 million, also about 3.2%.
The 43.8% proration figure is preliminary and subject to final transfer agent processing. The final rate has diverged from the manager’s initial estimate in each of the past two quarters: the fund accepted 47.8% of tendered units in the first quarter after estimating 45.8%, and accepted 41.6% in the second quarter after estimating 43%.
North Haven Private Income Fund reported estimated aggregate NAV of approximately $3.09 billion as of June 30, against approximately $2.98 billion of debt outstanding at principal. The portfolio spanned 299 companies across 45 industries with aggregate par value of approximately $6.85 billion, of which 96.5% was first lien debt. Debt-to-NAV stood at 0.94x as of July 31, down from 0.97x at May 31, and the fund reported more than $2 billion in undrawn debt capacity and cash and more than $350 million in liquid loans as of July 31.
Companion vehicle North Haven Private Income Fund A LLC, which issued a parallel investor letter the same day, reported third-quarter requests of approximately 6.8% of units outstanding, down from 7.2% in the second quarter. That fund will fulfill approximately 73.3% of each request at the same 5% cap, with an estimated net NAV impact of approximately $8.2 million, or about 2.8% of its June 30 NAV. The companion fund has repurchased approximately $45 million of units across the three periods ending Sept. 30 and reported debt-to-NAV of 1.04x as of July 31.
The results land in a quarter of mixed readings across the nontraded BDC sector. Blackstone Private Credit Fund capped third-quarter repurchases at 5% after requests of roughly 10% of shares, its third consecutive oversubscribed quarter, while BlackRock Private Credit Fund cleared its 5% cap without proration as HPS Corporate Lending Fund prorated again. Golub Capital Private Credit Fund satisfied third-quarter requests in full as demand fell to 4.8%.
Sector-wide, Robert A. Stanger & Co. Inc. reported that second-quarter redemption requests at private placement BDCs equaled 6.7% of NAV, with sponsors meeting 53% of those requests and nine funds prorating. Early third-quarter reporting pointed to lower demand, though from a limited sample.
Morgan Stanley Private Credit told investors that market conditions have grown more constructive than at the start of the year, citing improved lending terms, healthy sponsor activity, broadly stable credit fundamentals, and a rally in broadly syndicated loans with a particular rebound in software-related credits. Software is the fund’s largest industry exposure, at 22.9% of par value as of June 30.
North Haven Private Income Fund is managed by MS Capital Partners Adviser Inc., an indirect wholly owned subsidiary of Morgan Stanley, and invests primarily in directly originated senior secured loans to U.S. middle-market companies backed by private equity sponsors.
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