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- US PE Activity Climbs as GPs Double Down on Continuation Plays
US PE Activity Climbs as GPs Double Down on Continuation Plays
This week we're Americas PE deal activity, the rise of amended PIK, and how according to out latest survey, continuation vehicles are mostly viewed as a value creation tool.
Good morning, ! This week we're Americas PE deal activity, the rise of amended PIK, and how according to out latest survey, continuation vehicles are mostly viewed as a value creation tool.
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PRIVATE CREDIT
Watching the Rise of Amended PIK
Payment-in-Kind (PIK) interest is becoming an increasingly important diagnostic tool in private credit portfolios. While PIK can be a legitimate structuring feature at underwriting, the growing share of loans transitioning into PIK status post-close warrants closer scrutiny.
Debt tied to investments that did not originally include PIK but now do has expanded materially since 2021, with the majority of PIK-bearing loans reflecting midstream amendments rather than initial design. At the same time, the proportion of transactions classified as “bad PIK” has increased from roughly 2.5% to approximately 6.5% over the past four years.
These amendments rarely trigger formal defaults. Instead, they represent negotiated adjustments that defer cash interest obligations and preserve short-term liquidity. As a result, reported default rates may understate the degree of underlying credit stress embedded in portfolios.
For allocators, monitoring amended PIK exposure may provide a more forward-looking indicator of credit migration than headline default statistics alone. (More)
PRESENTED BY 9FIN
No one can afford to miss critical information regarding specific companies, sectors or industries. 9fin's platform provides best in class editorial coverage across the HY/BSL loan, Private Credit and CLO markets, ensuring clients have all the information needed to make critical portfolio decisions.
9fin's AI algorithms continuously analyze 4,000+ issuers across leveraged finance, tracking covenant packages, refinancing windows, and credit deterioration that impact valuations. See the intelligence platform restructuring advisors use to spot opportunities before the market moves and leading PE firms rely on to de-risk investments faster.
DEAL OF THE WEEK
Visa’s ~$1.5B Bet on Argentina’s Payment Rails
In a reported ~$1.5 billion transaction, Visa has agreed to acquire Prisma Medios de Pago and Newpay from Advent International, marking a decisive shift from network participant to infrastructure owner in Argentina.
Prisma processes more than 6 billion transactions annually, serving as a core issuer processor for Argentina’s leading banks. Newpay operates the Banelco ATM network, powers real-time rails including Transferencias 3.0, and runs PagoMisCuentas, one of the country’s dominant bill-payment platforms. This is not just a card network expansion—it’s control of the underlying rails.
Upon closing (expected in Visa’s fiscal Q2 2026), Visa plans to layer in tokenization, biometric authentication, intelligent risk tools, and agentic commerce, while enabling card-brand-agnostic processing across platforms.
For Advent, the deal monetizes a long-running transformation play while retaining Payway as a standalone merchant acquirer. (More)
MICROSURVEY
Continuation Vehicles: Value Creation Tool or Liquidity Patch?
In our latest PE150 micro survey of 58 professionals, sentiment around GP led continuation vehicles is anything but uniform.
47% view them as a value creation tool.
21% say they are increasingly concerning.
14% call them an overused liquidity patch.
12% find them attractive as an LP.
Just 7% see them as a pure liquidity necessity.
What this reveals is a market split between strategic believers and structural skeptics.
Nearly half the market believes continuation funds are proactive portfolio management tools. Yet more than one in three either question their overuse or worry about governance and pricing dynamics.
For GPs, the message is clear. Continuation vehicles are no longer experimental. They are mainstream. But mainstream invites scrutiny.
For LPs, the signal is even sharper. Alignment, valuation methodology, and asset quality will separate smart extensions from quiet warehousing.
In other words, GP led deals are not controversial. Bad ones are. (More)
REGIONAL FOCUS
The Comeback — Without the Chaos
Private equity in the Americas is back above $1.2T — but don’t call it a rerun of 2021.
After the $1.45T peak and 12,000+ deals, activity cooled sharply in 2022–2023 as higher rates, valuation resets, and tighter financing bit. Now in 2025*, deal value is rebounding faster than volume. Translation: fewer deals, bigger checks.
Sponsors are prioritizing platform assets with pricing power, leaning into add-ons, and backing AI, infrastructure, and services with durable cash flows. Private credit remains dominant, while syndicated markets have reopened enough to ease refinancing pressure.
Meanwhile, exit urgency is real. Aging portfolios and soft DPI are pushing GPs to transact as bid-ask spreads narrow.
Bottom line: This isn’t froth. It’s disciplined deployment — a normalized expansion built on underwriting rigor, not cheap leverage. (More)
TWEET OF THE WEEK
"You'll never do a whole lot unless you're brave enough to try."
Dolly Parton