8-K: Blackstone Secured Lending Fund Issues $500M Notes

Blackstone Secured Lending Fund has issued $500 million in 5.125% Notes due 2031 to finance its operations.

Summary

• Blackstone Secured Lending Fund (the Company) and U.S. Bank Trust Company, National Association (the Trustee) entered into a Ninth Supplemental Indenture on October 14, 2025.
• The Ninth Supplemental Indenture relates to the issuance of $500,000,000 aggregate principal amount of the Company's 5.125% Notes due 2031 (the Notes).
• The Notes will mature on January 31, 2031, and bear interest at a rate of 5.125% per annum, payable semi-annually on January 31 and July 31, commencing January 31, 2026.
• The Notes are general unsecured obligations of the Company, ranking senior to expressly subordinated indebtedness, pari passu with other unsecured indebtedness, and effectively junior to secured indebtedness and structurally junior to subsidiary indebtedness.
• The Company may redeem the Notes, in whole or in part, at its option at specified redemption prices, including the greater of a present value calculation or 100% of principal prior to the Par Call Date (December 31, 2030), and 100% of principal on or after the Par Call Date.
• Holders of the Notes do not have the option to have the Notes repaid prior to maturity, except in the event of a Change of Control Repurchase Event.
• The Indenture includes covenants requiring the Company to comply with the asset coverage requirements of the Investment Company Act of 1940 and to provide financial information to noteholders if it ceases to be subject to Exchange Act reporting.
• The Notes were offered and sold pursuant to a Registration Statement on Form N-2, with the transaction closing on October 14, 2025.
• The purchase price for the Notes paid by the underwriters was 98.518% of the aggregate principal amount, plus accrued interest from October 14, 2025.

Sentiment

Score: 7

Explanation: The successful issuance of $500 million in notes provides significant capital for the company's operations, which is a positive for its growth and liquidity. However, it also increases the company's debt obligations and associated financial risks, leading to a neutral to slightly positive overall sentiment.

Positives

• Successfully raised $500 million in capital, enhancing liquidity and funding capacity for future investments.
• Secured long-term financing with a fixed interest rate of 5.125% until 2031, providing predictable debt servicing costs.
• Diversifies the company's funding sources, which can improve financial flexibility.

Negatives

• Increases the company's overall debt burden and leverage.
• The fixed interest payments will impact the company's cash flow over the life of the notes.
• The Notes rank effectively junior to any secured indebtedness and structurally junior to all indebtedness incurred by the company's subsidiaries.

Risks

• Default in the payment of interest upon any Note when due and payable, continuing for a period of 30 days.
• Default in the payment of the principal (or premium, if any) upon any Note when due and payable at maturity, redemption, or required repurchase date.
• Default in the performance or breach of any covenant or agreement in the Indenture or Notes, continuing for 60 consecutive days after written notice.
• Default by the Company or any Significant Subsidiaries on indebtedness exceeding $100 million in aggregate, resulting in acceleration or failure to pay, unless discharged or rescinded within 30 calendar days.
• Asset coverage (as defined in the Investment Company Act) falling below 100% for 24 consecutive calendar months for any class of securities.
• A Change of Control Repurchase Event (defined as a Change of Control and a Below Investment Grade Rating Event) would require the Company to offer to repurchase outstanding Notes.

Future Outlook

The company will use commercially reasonable efforts to maintain its status as a business development company under the Investment Company Act and its qualification as a regulated investment company under Subchapter M of the Code for each full fiscal year. It also commits to furnishing financial statements to noteholders and the Trustee if it is no longer subject to Exchange Act reporting requirements.

Management Comments

• Teddy Desloge, Chief Financial Officer, signed the Ninth Supplemental Indenture on behalf of Blackstone Secured Lending Fund.
• Lucie Enns, Chief Legal Officer & Secretary, signed the Form 8-K and the Underwriting Agreement on behalf of Blackstone Secured Lending Fund and Blackstone Private Credit Strategies LLC.

Industry Context

This debt issuance is a common financing strategy for Business Development Companies (BDCs) like Blackstone Secured Lending Fund. BDCs typically leverage a mix of debt and equity to fund their investments in private companies. The issuance of fixed-rate notes provides stable, long-term capital, which is crucial for managing investment portfolios and can be particularly attractive in a fluctuating interest rate environment.

Corporate Governance

Related Party Transactions

• Blackstone Private Credit Strategies LLC (the Adviser), an affiliate, is a party to the Underwriting Agreement and provides investment advisory and administration services to the Fund.
• Blackstone Securities Partners L.P., an affiliate, is listed as an underwriter for $55,000,000 of the Notes.

Stakeholder Impact

• Shareholders: Potential for increased investment capacity and returns if the capital is deployed effectively, but also increased financial risk due to higher leverage and interest expense.
• Noteholders: Benefit from fixed interest payments and principal repayment at maturity, along with specific covenants and a change of control repurchase event provision for protection.
• Creditors: The new senior unsecured notes rank pari passu with existing unsecured debt and senior to subordinated debt, potentially affecting the recovery prospects of other unsecured creditors in a default scenario.

Next Steps

• Make semi-annual interest payments on the Notes on January 31 and July 31 of each year, commencing January 31, 2026.
• Repay the principal amount of the Notes on the maturity date of January 31, 2031, unless earlier redeemed or repurchased.
• Potentially redeem the Notes, in whole or in part, at the company's option, according to the specified redemption terms.
• Offer to repurchase Notes upon the occurrence of a Change of Control Repurchase Event.
• Continue to comply with asset coverage requirements under the Investment Company Act and maintain qualification as a regulated investment company under the Code.
• Furnish financial statements to noteholders and the Trustee if the company is no longer subject to Exchange Act reporting requirements.

Key Dates

Recommendation

The issuance of $500 million in 5.125% Notes due 2031 is a routine financing activity for Blackstone Secured Lending Fund, a business development company. This event provides capital for future investments but also increases the company's leverage. The terms appear consistent with market conditions for similar debt instruments. This is primarily a funding mechanism and does not inherently suggest a significant change in the company's fundamental equity value or operational performance that would warrant a strong buy or sell recommendation for its common shares. For bond investors, the fixed yield and maturity offer a predictable return, subject to the company's credit risk.

Keywords

Debt Offering, Notes, Fixed Income, Blackstone, Secured Lending, Corporate Bonds, Investment Company Act, SEC Filing, Capital Raise, Unsecured Debt