Clearlake Secures Landmark $5.5B Private Credit Facility for Dun & Bradstreet Take-Private

Clearlake Capital Group has finalized one of the largest private credit transactions in history – a $5.5 billion debt package led by Ares Management to fund its $7.7 billion leveraged buyout of Dun & Bradstreet Holdings[1][3][9]. This deal exemplifies private equity’s growing reliance on direct lenders amid volatile capital markets, with pricing at SOFR+500bps reflecting both market risk premiums and private credit’s pricing power in complex public-to-private transitions[3][5][12]. The transaction underscores three critical 2025 trends: 1) Private credit’s dominance in large-cap LBO financing, 2) Strategic shifts in debt structuring for public company acquisitions, and 3) Clearlake’s aggressive expansion into credit markets to complement its $90B AUM private equity platform[7][8][13].

💼 Seasoned CorpDev / M&A / PE expertise

Deal Architecture: Breaking Down the Capital Stack

Term Loan & Revolver Structure

The financing package comprises a $5 billion senior secured term loan priced at SOFR+500bps and a $500 million delayed-draw revolver[9]. With an original issue discount of 99 cents on the dollar, the effective yield reaches 10.55% when accounting for upfront fees and SOFR’s 5.05% base rate as of May 2025[9][17]. This pricing represents a 100-150bps premium to what Clearlake initially explored in the broadly syndicated loan (BSL) market, where high-yield investors demanded SOFR+400bps amid tariff-related volatility[3][12].

Bridge-to-Term Financing Dynamics

Morgan Stanley initially provided a $5.75B 364-day bridge facility in March 2025, but Clearlake pivoted to private credit after BSL market conditions deteriorated[3][10]. The bridge loan’s inability to convert to permanent financing – coupled with Trump administration tariff announcements creating spread volatility – pushed Clearlake to pay a $86M commitment fee to exit the bank arrangement[3][12]. Ares’ ability to club-deal the $5B+ facility within 45 days demonstrates private credit’s execution advantage for time-sensitive public company acquisitions[5][9].

Market Context: Why Private Credit Prevailed

BSL Market Retreat

The broadly syndicated loan market has seen 32% fewer large-cap LBO financings YTD 2025 compared to 2024, with average clearing spreads widening 75bps[12]. Dun & Bradstreet’s 3.6x leverage ratio and 40% EBITDA growth since 2019 made it theoretically syndication-worthy, but its $14B market cap and exposure to business cyclicality deterred traditional CLO buyers[6][16]. “When you’re taking a 184-year-old data giant private, certainty of execution trumps marginal cost savings,” notes a Rothschild & Co banker involved in the deal[11].

Covenant Quality Shift

Ares imposed maintenance covenants requiring Dun & Bradstreet to maintain:

• Total leverage ratio ≤ 6.5x (vs. 7.25x in initial bank proposal)
• Interest coverage ratio ≥ 2.0x
• Minimum liquidity of $300M

These terms contrast sharply with 2021-era covenant-lite deals and reflect lenders’ renewed focus on downside protection[12][17]. The structure includes springing maturity adjustments tied to D&B’s data-as-a-service (DaaS) revenue targets – a bespoke feature enabled by private credit’s flexible documentation[3][5].

Strategic Implications for Clearlake

Vertical Integration Play

This transaction advances Clearlake’s strategy to build an end-to-end capital solutions platform following its 2025 acquisition of MV Credit and 2020 purchase of WhiteStar Asset Management[7][13]. The firm now manages $57B across private credit strategies – a 90% increase since 2023 – with plans to reach $100B by 2030[8][13]. “Our credit capabilities let us structure entire capital stacks for complex deals like D&B without relying on third-party lenders,” explains Clearlake co-founder Behdad Eghbali[6][8].

Value Creation Levers

Clearlake plans to accelerate Dun & Bradstreet’s AI roadmap using its OPS® operating system, targeting:

• Integration of D&B’s 500M+ company dataset with Clearlake portfolio companies’ vertical SaaS platforms
• 15-20% CAGR in high-margin analytics revenue through 2030
• $150M annual cost synergies from legacy IT infrastructure modernization

The firm will deploy its proprietary value creation matrix focusing on data monetization, cross-sell acceleration, and global expansion into underpenetrated Asian markets[6][16].

Broader Market Impact

Private Credit’s Institutionalization

This deal cements private credit’s role in mega-LBOs, with 63% of $5B+ take-privets in 2025 using direct lenders versus 22% in 2021[12]. Key structural shifts include:

• Average hold sizes per lender increased to $750M from $250M in 2020
• Tenors extending to 7-8 years with bullet maturities
• Custom EBITDA add-backs for cloud migration costs

As José Feliciano, Clearlake’s co-founder, notes: “The line between private equity and private credit is blurring – our integrated model reduces execution risk while capturing more value across the capital structure”[8][13].

Regulatory Considerations

The Federal Reserve’s 2024 guidance on leveraged lending (SR 24-5) has inadvertently pushed more deals into private credit by:

• Capping bank-led LBO debt at 6x EBITDA for non-syndicated deals
• Requiring 50% equity cushions for cyclical businesses
• Mandating stress testing for BSL deals above $5B

These constraints have created a $200B+ annual funding gap that private credit is filling – particularly for data-rich businesses like D&B that require specialized underwriting[12][17].

Conclusion: A New Paradigm for Public-to-Private Transitions

Clearlake’s D&B acquisition demonstrates how private equity firms are leveraging in-house credit capabilities to execute complex take-privates that would have required syndicated bank debt just three years ago. With $1.4T in dry powder across private credit funds and increasing comfort with $5B+ check sizes, direct lenders are rewriting the rules of corporate ownership transitions[12][17]. As market volatility persists, expect more sponsors to follow Clearlake’s playbook – using integrated capital solutions to secure deals while maintaining tighter control over post-acquisition value creation.