PGIM announces $4.2B final close of middle market direct lending fund

By: Prudential Financial, Inc. via Business Wire

August 01, 2025 at 06:32 AM EDT

PGIM today announced the final close of PGIM Senior Loan Opportunities II, L.P. (“PSLO II”), the second commingled private credit fund available to unaffiliated investors in its middle market direct lending series. PSLO II closed with over $4.2 billion in available capital commitments, making it one of the largest middle market direct lending private credit fundraises year to date,¹ and reflecting strong support from a global base of institutional investors.

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“Our ability to capture both sponsored and non-sponsored channels is a differentiator and has been validated by our investors.” -- Matt Harvey, Head of Middle Market Direct Lending, PGIM

Building on the success of its predecessor, PSLO II will provide senior secured financing to middle market companies across North America, Europe, and Australia. The fund attracted commitments from a diverse group of institutional investors, including insurance companies, pension funds, and sovereign wealth funds.

PSLO II’s strategy focuses on delivering attractive risk-adjusted returns through a diversified portfolio of directly originated senior loans to both sponsored and non-sponsored issuers. The fund has already begun deploying capital, with a strong pipeline of opportunities and a well-developed investment portfolio.

Matt Harvey, head of middle market direct lending for PGIM’s private capital business, commented: “Much of the growth in direct lending in recent years has been in sponsor-backed deals. But that channel is no longer sufficient to achieve appropriate diversification and deployment targets for investors. In the U.S. alone, there are around 200,000 middle market companies, and only about 10,000 are private equity owned. This means more than 90% of the addressable market remains non-sponsored.² Our ability to capture both sponsored and non-sponsored channels is a differentiator and has been validated by our investors.”

Harvey continued: “Origination capability is the cornerstone of success in private credit as it underpins our ability to execute with discipline, benefiting from broader selectivity. In a market characterized by information asymmetry, direct bilateral origination at scale across the middle market — built over years — creates proprietary deal flow and underwriting advantages.”

As a long-term private credit market participant, PGIM has managed direct lending strategies for affiliate investors since 2000. Today, PGIM manages a range of strategies that span the direct lending market from the lower middle market (through PGIM’s partnership with Deerpath Capital); to the middle market, where the firm has strategies catering to high-net-worth and institutional clients; as well as the large-cap market segment.

In June 2025, PGIM confirmed it would bring together its Fixed Income and Private Credit businesses under a global capability spanning public and private markets, creating an industry-leading public and private fixed income team with a credit platform of nearly $1 trillion.

ABOUT PGIM

PGIM is the global asset management business of Prudential Financial, Inc. (NYSE: PRU). In 41 offices across 19 countries, our more than 1,450 investment professionals serve both retail and institutional clients around the world.

As a leading global asset manager with $1.39 trillion in assets under management,³ PGIM is built on a foundation of strength, stability, and disciplined risk management. Our multi-affiliate model allows us to deliver specialized expertise across key asset classes with a focused investment approach. This gives our clients a diversified suite of investment strategies and solutions with global depth and scale across public and private asset classes, including fixed income, equities, real estate, private credit, and other alternatives. For more information visit pgim.com.

Prudential Financial, Inc. (PFI) of the United States is not affiliated in any manner with Prudential plc, incorporated in the United Kingdom, or with Prudential Assurance Company, a subsidiary of M&G plc, incorporated in the United Kingdom. For more information please visit news.prudential.com.

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¹Source: Pitchbook, as of July 2025.

²Number of middle market companies sourced from National Center for the Middle Market; number of private equity backed companies sourced from Pitchbook.com; PGIM estimates.

³ As of March 31, 2025.