(Bloomberg) -- Blackstone Inc.’s credit unit is looking to sell about $450 million of loans, some of which are distressed, as it aims to provide liquidity to investors in an older fund, according to people with knowledge of the matter.

The alternative-asset manager bought the loan portfolio for $2.4 billion in 2017 from NewStar Financial, the people said, asking not to be identified discussing confidential matters. The fund is past its reinvestment window, and Blackstone is selling off the remaining loans. 

The firm has been working with Evercore Inc. to shop the portfolio, which includes debt from travel rewards program Arrivia, American Achievement Corp., BMC Software Inc. and Charter Communications Inc., according to one of the people.

Blackstone selected a bid that valued the portfolio at around 60 cents on the dollar, though the transaction has yet to close, according to one of the people.

Representatives for Blackstone and Evercore declined to comment.

Deal Rut

In recent years, cash distributions — particularly in private equity — have slowed to a trickle due to a prolonged deal drought stemming from higher interest rates. 

Secondaries trading of private investments has grown as investors look for liquidity amid the tougher environment for exits and assets sales. PJT Partners expects at least $135 billion in secondaries deal volume this year, up about 17% from 2023, according to a market report.

Read More: Secondhand Private Credit Sets Up $15 Billion of Early Exits

Credit secondaries is a newer, developing area of the market that has emerged from the rapid growth of private credit to $1.7 trillion of assets, as banks rein in lending due to higher capital requirements. 

The majority of credit secondaries transactions so far have been for first-lien direct loans, according to market participants. Credit secondaries pricing on partner-led portfolios was 88 cents to 93 cents on the dollar in the first quarter, according to PJT.

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