Publication of the Aether FS Unitranche France index for the 1st quarter 2025

Paris, May 20 2025

Publication of the Aether FS Unitranche France index for the 1st quarter 2025

The Aether FS Unitranche France Index continued its upward trend in Q1 2025. The margin per leverage turn stands at 1.62%, compared to 1.55% in the previous quarter. This increase is mainly due to the decrease in leverage at closing.

6 months rolling average interest margin/levarage ratio

Q1 was marked by a simultaneous decrease in closing spreads and leverage levels compared to the previous quarter. The decline in leverage (4.13x versus 4.51x in the previous quarter) reflects a certain caution towards debt usage in the context of the trade war that affected the early months of the year. Average closing spreads also decreased but remained above 6% (exactly 6.01%), a consistent level in the unitranche debt sector. Since the decrease in spreads was less significant than the decrease in leverage, the Aether FS Unitranche France Index ultimately progressed this quarter.

Evolution of Leverage at closing

Evolution of Spreads at closing

However, the trade war waged by the U.S. administration caused a shock to financial markets in March-April. In this climate of distrust, the private market reacted cautiously towards new operations under negotiation and structuring. A recent PwC study also highlighted a polarization between high-quality assets, justifying high valuations, and those requiring operational transformations to improve their attractiveness. Refinancing or disposals will need to be carried out in the coming months with assets that have not sufficiently deleveraged to present an attractive profile to the market. In this context, participants prefer to opt for an extension of debt maturities.