Mercer Advisors Refinances $1.6 Billion in Private Credit With Bank Loan

The wealth manager will cut its borrowing margin by 1.75 percentage points, saving about $29 million annually.

By the Family Office Real Estate Daily Desk·Monday, September 21, 2026·1 min read

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The answer · checked against WealthManagement.com

Why is Mercer Advisors refinancing $1.6 billion in private credit and how much will it save?

Mercer Advisors Inc. is refinancing approximately $1.6 billion in existing private credit debt with a new $1.65 billion seven-year leveraged loan, cutting its borrowing margin by 1.75 percentage points and saving about $29 million annually. The new loan is priced at 2.75 percentage points over the floating-rate benchmark, replacing debt that carried a rate of 4.5 percentage points over the benchmark. The debt offering also includes a $250 million delayed draw term loan earmarked for acquisitions and other investments.

Key facts

Mercer Advisors Inc. priced a new seven-year $1.65 billion leveraged loan at 2.75 percentage points over the floating-rate benchmark and at 99.75 cents on the dollar, according to a person with knowledge of the matter.
Mercer Advisors will use the proceeds to refinance around $1.6 billion in existing private credit debt that carries a rate of 4.5 percentage points over the benchmark, according to the same person.
The refinancing cuts Mercer Advisors' borrowing margin by 1.75 percentage points, saving about $29 million annually.
The debt offering included a $250 million delayed draw term loan designated for funding acquisitions and other investments, according to the person with knowledge of the matter.
Existing lenders on the refinanced debt include KKR & Co., Ares Management Corp., BlackRock Inc., and funds managed by Apollo Global Management Inc., including a MidCap Financial fund, according to regulatory filings.
Goldman Sachs Group Inc. led the refinancing, according to the source text, and Oak Hill Capital is the private equity owner of Mercer Advisors.

Mercer Advisors Refinances $1.6 Billion in Private Credit With Bank Loan — Image: editorial illustration · Story sourced from WealthManagement.com

Mercer Advisors priced a $1.65 billion leveraged loan on Thursday to refinance private credit debt, joining a wave of companies that are replacing direct-lender capital with cheaper bank financing. The wealth management firm will use the proceeds to repay about $1.6 billion in existing debt from private credit firms, a person with knowledge of the matter said.

The new seven-year loan carries an interest rate of 2.75 percentage points over the floating-rate benchmark and was priced at 99.75 cents on the dollar, the person said. The debt offering also included a $250 million delayed draw term loan for funding acquisitions and other investments. Goldman Sachs Group led the refinancing. Representatives for Goldman Sachs and private equity owner Oak Hill Capital declined to comment.

Mercer will replace debt that carries a rate of 4.5 percentage points over the benchmark. Existing lenders include KKR, Ares Management, BlackRock and funds managed by Apollo Global Management, including a MidCap Financial fund, regulatory filings show. The firm oversees about $111 billion in client assets.

The refinancing cuts the company's borrowing margin by 1.75 percentage points, saving about $29 million annually. Gün Keresteci, Mercer's chief financial officer, said lower costs will give the firm flexibility to better serve clients. He called the refinancing a natural next step for the company.

More risky borrowers have been refinancing private debt in the syndicated markets this year rather than the other way around. Just $9.2 billion of broadly syndicated loans have been refinanced into private credit this year, while $19.5 billion has gone the other way, data from JPMorgan Chase and KBRA DLD published Thursday show.

Michael Moore, a managing director at DC Advisory, said borrowers with access to the broadly syndicated market today are probably going to favor that market because it is strictly a cost of capital conversation. If the financing is not complicated, they can save more in that market, he said.

The Deployment Angle

Family Office Real Estate Daily Desk · our analysis, not the source's

Family offices holding private credit fund stakes should model the portfolio impact if sponsors refinance 20 to 30 percent of borrowers out of the asset class over the next 18 months. Mercer's $1.6 billion redemption from KKR, Ares, BlackRock and Apollo is large enough to matter at the fund level, and it follows a pattern now visible in the data.

The arithmetic is straightforward. Mercer was paying 4.5 percentage points over the benchmark on $1.6 billion in private credit debt. It now pays 2.75 percentage points over the benchmark on $1.65 billion in bank debt, which includes a $250 million delayed draw component. The 1.75-percentage-point spread compression saves the borrower $29 million a year, which is $29 million that does not flow to the private credit lenders.

A family office considering a new private credit commitment should price in the possibility that the highest-quality sponsors will refinance at the first opportunity. Underwrite for prepayment risk and for lower returns on capital if the fund cannot redeploy quickly into replacement loans. Direct co-investment alongside a private credit manager mitigates some of this timing risk because the family office can negotiate for a longer lock-up or for fee protection on early repayment.

If the family office is already invested in private credit funds that lent to Mercer or similar wealth platforms, ask the manager how it plans to redeploy the capital and whether it expects more refinancing activity in the next six months. The manager's answer will reveal whether it sees this as an isolated event or the start of a repricing cycle that could compress returns across the portfolio.

Questions this story answers

01Why is Mercer Advisors refinancing its private credit debt with a bank loan?

Mercer Advisors is refinancing to cut borrowing costs. The existing private credit debt carries a rate of 4.5 percentage points over the floating-rate benchmark; the new leveraged loan is priced at 2.75 percentage points over the same benchmark, reducing the borrowing margin by 1.75 percentage points and saving about $29 million annually. Mercer CFO Gün Keresteci said lower costs will give the firm flexibility to better serve clients.

02Who were the private credit lenders that Mercer Advisors is paying off?

Existing lenders on Mercer Advisors' private credit debt include KKR & Co., Ares Management Corp., BlackRock Inc., and funds managed by Apollo Global Management Inc., including a MidCap Financial fund, according to regulatory filings cited in the source.

03How much does Mercer Advisors manage in client assets?

Mercer Advisors oversees about $111 billion in client assets, according to the source.

04Is the trend of refinancing private credit into bank loans widespread in 2026?

According to data from JPMorgan Chase & Co. and KBRA DLD published on the same date as the Mercer announcement, $19.5 billion in private credit has been refinanced into the broadly syndicated loan market so far this year, while only $9.2 billion of broadly syndicated loans have been refinanced into private credit.

05What is the $250 million delayed draw term loan in Mercer's deal intended for?

The $250 million delayed draw term loan included in Mercer Advisors' debt offering will go toward funding acquisitions and other investments, according to a person with knowledge of the matter who asked not to be identified because the information is private.

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Original reporting

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