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Investing.com -- Financial technology company IntraFi has raised over $2 billion in the leveraged loan market, representing a victory for Wall Street banks against private credit firms that had previously discussed providing financing.
A banking consortium led by Morgan Stanley (NYSE:MS) arranged the debt package for IntraFi, which is backed by Blackstone (NYSE:BX) Inc. and Warburg Pincus. The funds will allow the fintech company to pay dividends to its private equity owners and refinance a portion of its higher-risk debt, according to Bloomberg, citing people with knowledge of the matter.
The debt arrangement consists of a $705 million incremental first-lien loan and a $1.3 billion second-lien debt tranche, Bloomberg reports, citing the people. These loans were expanded by a total of $540 million from their initial offering size.
Major Wall Street banks have been capitalizing on favorable conditions in public debt markets to raise billions in loans and bonds. This strategy has effectively priced out direct lenders, who typically provide financing with more expensive but flexible terms.
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