Morgan Stanley Direct Lending Fund has announced a 10% dividend cut, driven by challenges in covering the dividend with net investment income amid rising concerns over loan defaults in the SaaS sector. The fund, which has approximately 20% exposure to SaaS companies—consistent with industry standards—has seen its shares trade at a 27% discount to net asset value due to increased non-accruals and negative sentiment in the broader business development company market. This trend is prevalent as many BDCs are experiencing significant selling pressure, largely influenced by fears surrounding loan defaults in private credit lending.
Morgan Stanley Direct Lending resets dividend by 10% amid NAV discount
