BlackRock sells nearly half of loan portfolio to Pantheon-backed vehicle in $523M deal

BlackRock TCP Capital Corp. is parting ways with nearly half its loan book. The Nasdaq-listed business development company, managed by BlackRock, announced the sale of a $523 million portfolio of private loans to a continuation vehicle sponsored by Pantheon, representing 48% of TCPC’s total debt investments across 78 portfolio companies.

The deal, announced on August 4, is essentially BlackRock’s way of cleaning house. TCPC will retain just a 5% equity stake in the vehicle while offloading the other 95%, generating roughly $152 million in gross proceeds.

The math behind the move

TCPC expects approximately a 10.4% decline in net asset value, equivalent to a loss of $0.68 per share based on June 30, 2026 figures. TCPC’s net debt ratio is expected to drop from 1.38x to roughly 0.4x, with the company targeting a further reduction below 0.3x after additional paydowns.

The portfolio was sold at 95% of gross fair value as of December 31, 2025 valuations, though those marks may be adjusted subsequently. Despite the NAV decline, the sale is believed to realize a premium compared to TCPC’s current share price.

Why continuation vehicles are the new exit strategy

Pantheon isn’t just buying a pile of loans. It’s setting up a continuation vehicle, a mechanism that has become increasingly popular in private equity and private credit circles. The original fund passes the portfolio to a new vehicle that can manage it for a longer time horizon. The seller gets liquidity. The buyer gets a diversified, pre-built portfolio without having to source 78 individual deals.

For managers like Pantheon, which specializes in private equity secondaries and co-investments, continuation vehicles offer the chance to acquire diversified exposure at negotiated terms.

The transaction follows what has been a rough stretch for TCPC. The fund has dealt with markdowns on distressed loans and ongoing regulatory scrutiny. TCPC merged with BlackRock Capital Investment Corp. in March 2024, significantly expanding its portfolio.

TCPC shareholders will need to weigh the near-term NAV erosion against the longer-term benefits of a cleaner balance sheet. A BDC running at 0.3x leverage has far more capacity to originate new loans than one stretched at 1.38x.