Recent third-party tender offers for shares of several nontraded business development companies are putting a spotlight on the price investors may pay for immediate liquidity. Cox Capital Partners launched offers in July to acquire shares of nontraded BDCs managed by Apollo, Ares and BlackRock’s HPS Investment Partners at prices ranging from 15% to 30% below their May 31 net asset values. The offers totaled only about $31 million, but they come as repurchase requests across the nontraded BDC market have increased. Fitch Ratings found that requests rose at 10 of the 16 nontraded BDCs it tracks during the second quarter, averaging 10.3% of shares outstanding, according to Reuters.
For advisors and investors, however, a third-party offer at a substantial discount should not necessarily be interpreted as evidence that a fund’s reported NAV is overstated. Nontraded BDCs are designed as long-term investments with limited liquidity, and many typically offer to repurchase only a portion of outstanding shares each quarter. An investor seeking liquidity outside that process may encounter a buyer demanding a discount in exchange for providing an immediate exit. The difference between NAV and a secondary-market offer can therefore reflect the value—or cost—of liquidity as well as the buyer’s assessment of investment risk.
The recent activity reinforces the importance of discussing liquidity before clients invest rather than when they want to exit. Advisors evaluating nontraded BDCs can look beyond headline yields to examine repurchase history, subscription and redemption activity, NAV trends, portfolio credit quality and other measures that can help put liquidity events into context. Comparative research, including Blue Vault’s historical nontraded BDC data, can help advisors assess those factors across funds and sponsors rather than viewing an individual discounted offer in isolation.
Sources
- Reuters, Private Credit Roundup – Discounts Show the Cost of Getting Out, July 17, 2026.
- Reuters Breakingviews, Private Credit Gadflies Sense Public Opportunities, July 14, 2026.
