8-K
Morgan Stanley Direct Lending Fund (MSDL)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 8, 2025
Morgan Stanley Direct Lending Fund
(Exact name of registrant as specified in its charter)
| Delaware | 814-01332 | 84-2009506 |
|---|---|---|
| (State or other jurisdiction<br> <br>of incorporation) | (Commission<br> <br>File Number) | (IRS Employer<br> <br>Identification Number) |
| 1585 Broadway<br> <br>New York, NY | 10036 | |
| --- | --- | |
| (Address of principal executive offices) | (Zip Code) |
1 (212) 761-4000
(Registrant’s telephone number, including area code)
Not Applicable
(Former Name or Former Address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading<br> <br>Symbol(s) | Name of each exchange<br> <br>on which registered |
|---|---|---|
| Common Stock, par value $0.001 per share | MSDL | The New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02. | Results of Operations and Financial Condition. |
|---|
On May 8, 2025, Morgan Stanley Direct Lending Fund (the “Company”) issued a press release announcing its financial results for the first quarter ended March 31, 2025. The text of the press release is included as Exhibit 99.1 to this Form 8-K.
The information disclosed under this Item 2.02, including Exhibit 99.1 hereto, is being “furnished” and shall not be deemed “filed” by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, and shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
| Item 7.01. | Regulation FD Disclosure. |
|---|
On May 8, 2025, the Board of Directors of the Company declared a regular distribution to stockholders in the amount of $0.50 per share. The distribution will be payable on or around July 25, 2025 to stockholders of record as of June 30, 2025.
The information disclosed under this Item 7.01, including Exhibit 99.1 hereto, is being “furnished” and shall not be deemed “filed” by the Company for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that Section, and shall not be deemed incorporated by reference into any filing under the Securities Act, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
| Item 9.01. | Financial Statements and Exhibits. |
|---|
(d) Exhibits:
| Exhibit<br>Number | Description |
|---|---|
| 99.1 | Press Release of Morgan Stanley Direct Lending Fund, dated May 8, 2025. |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Dated: May 8, 2025 | MORGAN STANLEY DIRECT LENDING FUND | |
|---|---|---|
| By: | /s/ David Pessah | |
| David Pessah | ||
| Chief Financial Officer |
EX-99.1
Exhibit 99.1
Morgan Stanley Direct Lending Fund Announces March 31, 2025 Financial Results and
Declares Second Quarter 2025 Regular Dividend of $0.50 per Share
NEW YORK, NY, May 8, 2025 — Morgan Stanley Direct Lending Fund (NYSE: MSDL) (“MSDL” or the “Company”), a business development company externally managed by MS Capital Partners Adviser Inc. (the “Adviser”), today announced its financial results for the first quarter ended March 31, 2025.
QUARTERLY HIGHLIGHTS
| • | Net investment income of $46.2 million, or $0.52 per share, as compared to $50.7 million, or $0.57 per<br>share, for the quarter ended December 31, 2024; |
|---|---|
| • | Net asset value of $20.65 per share, as compared to $20.81 as of December 31, 2024; |
| --- | --- |
| • | Debt-to-equity was 1.11x as of<br>March 31, 2025, as compared to 1.08x as of December 31, 2024; |
| --- | --- |
| • | New investment commitments of $233.4 million, fundings of $205.6 million and sales and repayments of<br>$201.8 million, resulting in net funded deployment of $3.8 million; |
| --- | --- |
| • | The Company’s Board of Directors (the “Board”) declared a regular dividend of $0.50 per share to<br>shareholders of record as of March 31, 2025; and |
| --- | --- |
| • | The Company established an<br>at-the-market offering (“ATM”) through which the Company may sell shares of its common stock, having an aggregate offering price of up to $300.0 million.<br> |
| --- | --- |
SELECTED FINANCIAL HIGHLIGHTS
| For the Quarter Ended | ||||
|---|---|---|---|---|
| ($ in thousands, except per share information) | March 31, 2025 | December 31, 2024 | ||
| Net investment income per share | 0.52 | $ 0.57 | ||
| Net realized and unrealized gains (losses) per<br>share^1^ | ( 0.18 | $ 0.01 | ||
| Earnings per share | 0.34 | $ 0.58 | ||
| Regular dividend per share | 0.50 | $ 0.50 | ||
| Special dividend per share | — | $ 0.10 |
All values are in US Dollars.
| ^1^ | Amount shown may not correspond for the period as it includes the effect of the timing of the<br>distribution, shares repurchased and the issuance of common stock. | |||
|---|---|---|---|---|
| As of | ||||
| --- | --- | --- | --- | --- |
| ($ in thousands, except per share information) | March 31, 2025 | December 31, 2024 | ||
| Investments, at fair value | $ | 3,788,178 | $ | 3,791,494 |
| Total debt outstanding, at principal | $ | 2,013,588 | $ | 1,983,401 |
| Net assets | $ | 1,817,807 | $ | 1,842,156 |
| Net asset value per share | $ | 20.65 | $ | 20.81 |
| Debt to equity | 1.11x | 1.08x | ||
| Net debt to equity | 1.07x | 1.04x |
RESULTS OF OPERATIONS
Total investment income for the quarter ended March 31, 2025 was $101.5 million, compared to $103.0 million for the quarter ended December 31, 2024. The decrease was primarily driven by lower base rates, partially offset by higher repayment related income as compared to the prior period.
Total net expenses for the quarter ended March 31, 2025 were $55.2 million, compared to $52.3 million for the quarter ended December 31, 2024. The increase in net expenses quarter over quarter was primarily attributable to higher net management and income based incentive fees incurred following the expiration of the Adviser’s waiver of a portion of the base management and incentive fees in connection with the Company’s initial public offering.
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Net investment income for the quarter ended March 31, 2025 was $46.2 million, or $0.52 per share, compared to $50.7 million, or $0.57 per share, for the quarter ended December 31, 2024.
For the quarter ended March 31, 2025, net change in unrealized depreciation on investments was $17.1 million, partially offset by net realized gains of $0.5 million.
PORTFOLIO ANDINVESTMENT ACTIVITY
As of March 31, 2025, the Company’s investment portfolio had a fair value of approximately $3.8 billion, comprised of 210 portfolio companies across 34 industries, with an average investment size of $18.0 million, or 0.5% of our total portfolio on a fair value basis. The composition of the Company’s investments was the following:
| March 31, 2025 | December 31, 2024 | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| ($ in thousands) | Cost | FairValue | % of TotalInvestments atFair Value | Cost | FairValue | % of TotalInvestments atFair Value | ||||||||
| First Lien Debt | $ | 3,679,424 | $ | 3,652,320 | 96.3 | % | $ | 3,669,886 | $ | 3,654,538 | 96.5 | % | ||
| Second Lien Debt | 82,134 | 71,190 | 1.9 | 78,803 | 69,367 | 1.8 | ||||||||
| Other Debt Investments | 11,008 | 9,603 | 0.3 | 9,755 | 9,198 | 0.2 | ||||||||
| Equity | 54,165 | 55,065 | 1.5 | 54,683 | 58,391 | 1.5 | ||||||||
| Total | $ | 3,826,731 | $ | 3,788,178 | **** | 100.0 | % | $ | 3,813,127 | $ | 3,791,494 | **** | 100.0 | % |
Investment activity was as follows:
| Investment Activity: | Three Months EndedMarch 31, 2025 | Three Months EndedDecember 31, 2024 | ||
|---|---|---|---|---|
| New investment commitments, at par | $ | 233,368 | $ | 188,269 |
| Investment fundings | $ | 205,647 | $ | 187,324 |
| Number of new investment commitments in portfolio companies | 9 | 10 | ||
| Number of portfolio companies exited or fully repaid | 7 | 2 |
Total weighted average yield of investments in debt securities at amortized cost and fair value was 10.2% and 10.3%, respectively, as of March 31, 2025, compared to 10.4% and 10.5%, respectively, as of December 31, 2024. Floating rate debt investments as a percentage of total portfolio on a fair value basis was 99.6% as of March 31, 2025, unchanged compared to December 31, 2024. As of March 31, 2025, certain investments in two portfolio companies were on non-accrual status, representing approximately 0.2% of total investments at amortized cost.
CAPITAL AND LIQUIDITY
As of March 31, 2025, the Company had total principal debt outstanding of $2,013.6 million, including $316.0 million outstanding in the Company’s BNP funding facility, $647.6 million outstanding in the Company’s Truist credit facility, $275.0 million outstanding in the Company’s senior unsecured notes due September 2025, $425.0 million outstanding in the Company’s senior unsecured notes due February 2027 and $350.0 million outstanding in the Company’s senior unsecured notes due May 2029. On February 25, 2025, the Company executed an amendment to the Truist Credit Facility, extending the maturity to February 2030, increasing the total commitment to $1.45 billion and lowering the spread to 1.775%. The combined weighted average interest rate on debt outstanding was 6.11% for the quarter ended March 31, 2025. As of March 31, 2025, the Company had $1,084.1 million of availability under its credit facilities and $65.6 million in unrestricted cash. Debt to equity was 1.11x and 1.08x as of March 31, 2025 and December 31, 2024, respectively.
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SHARE REPURCHASES
In January 2024, the Company authorized a share repurchase program to acquire up to $100.0 million in the aggregate of the Company’s common stock at prices below net asset value. On February 27, 2025, the Board authorized an amended and restated share repurchase program, which has a maximum size of $100.0 million, exclusive of prior repurchases. For the three months ended March 31, 2025, the Company repurchased 491,332 shares at an average price of $20.38 per share.
ATM OFFERING
On March 28, 2025, the Company entered into equity distribution agreements pursuant to which the Company may sell shares of the Company’s common stock having an aggregate offering price of up to $300.0 million.
For the three months ended March 31, 2025 there were no shares issued through the ATM offering.
OTHER DEVELOPMENTS
On May 8, 2025, the Board declared a regular distribution of $0.50 per share, which is payable on July 25, 2025 to shareholders of record as of June 30, 2025.
CONFERENCE CALL INFORMATION
Morgan Stanley Direct Lending Fund will host a conference call on Friday, May 9, 2025 at 10:00 am ET to review its financial results and conduct a question-and-answer session. All interested parties are invited to participate in the live earnings conference call by using the following dial-in numbers or audio webcast link available on the MSDL Investor Relations website:
| • | Audio Webcast |
|---|---|
| • | Conference Call |
| --- | --- |
| • | Domestic: 323-994-2093<br> |
| --- | --- |
| • | International: 888-254-3590<br> |
| --- | --- |
| • | Passcode: 221038 |
| --- | --- |
To avoid potential delays, please join at least 10 minutes prior to the start of the earnings call. An archived replay will also be available on the MSDL Investor Relations website.
About Morgan Stanley Direct Lending Fund
Morgan Stanley Direct Lending Fund (NYSE: MSDL) is a non-diversified, externally managed specialty finance company focused on lending to middle-market companies. MSDL has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. MSDL is externally managed by MS Capital Partners Adviser Inc., an indirect, wholly owned subsidiary of Morgan Stanley. MSDL is not a subsidiary of or consolidated with Morgan Stanley. For more information about Morgan Stanley Direct Lending Fund, please visit www.msdl.com.
Forward-Looking Statements
Statements included herein or on the webcast/conference call may constitute “forward-looking statements,” which relate to future events or MSDL’s future performance or financial condition. These statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results and conditions may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in MSDL’s filings with the U.S. Securities and Exchange Commission. MSDL undertakes no duty to update any forward-looking statements made herein or on the webcast/conference call.
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Contacts
| Investors<br> <br>Sanna Johnson<br><br><br>msdl@morganstanley.com | Media<br> <br>Alyson Barnes<br><br><br>212-762-0514<br><br><br>alyson.barnes@morganstanley.com |
|---|
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Consolidated Statements of Assets and Liabilities
(In thousands, except share and per share amounts)
| December 31, 2024 | |||
| (Audited) | |||
| Assets | |||
| Non-controlled/non-affiliated<br>investments, at fair value (amortized cost of 3,821,720 and 3,813,127) | 3,783,126 | $ | 3,791,494 |
| Non-controlled/affiliated investments, at fair value<br>(amortized cost of 5,011 and 0) | 5,052 | — | |
| Total investments, at fair value (amortized cost of 3,826,731 and 3,813,127) | 3,788,178 | 3,791,494 | |
| Cash and cash equivalents (restricted cash of 3,820 and 2,000) | 69,400 | 72,372 | |
| Deferred financing costs | 19,847 | 16,498 | |
| Interest and dividend receivable from non-controlled/non-affiliated investments | 26,894 | 30,554 | |
| Interest and dividend receivable from<br>non-controlled/affiliated investments | 40 | — | |
| Receivable for investments sold/repaid | 364 | 470 | |
| Prepaid expenses and other assets | 7,448 | 630 | |
| Total assets | 3,912,171 | 3,912,018 | |
| Liabilities | |||
| Debt (net of unamortized debt issuance costs of 5,634 and 6,527) | 2,008,946 | 1,973,479 | |
| Payable for investment purchased | 2,096 | 192 | |
| Payable to affiliates (Note 3) | 11 | 29 | |
| Dividends payable | 44,103 | 53,229 | |
| Management fees payable | 8,977 | 7,042 | |
| Income based incentive fees payable | 9,468 | 8,956 | |
| Payable for Stock repurchased (Note 8) | 392 | — | |
| Interest payable | 16,366 | 21,205 | |
| Accrued expenses and other liabilities | 4,005 | 5,730 | |
| Total liabilities | 2,094,364 | 2,069,862 | |
| Commitments and contingencies (Note 7) | |||
| Net assets | |||
| Preferred stock, 0.001 par value (1,000,000 shares authorized; no shares issued and<br>outstanding) | — | — | |
| Common stock, par value 0.001 (500,000,000 shares authorized; 88,019,757 and 88,511,089 shares<br>issued and outstanding) | 88 | 89 | |
| Paid-in capital in excess of par value | 1,802,435 | 1,812,443 | |
| Total distributable earnings (loss) | 15,284 | 29,624 | |
| Total net assets | 1,817,807 | $ | 1,842,156 |
| Total liabilities and net assets | 3,912,171 | $ | 3,912,018 |
| Net asset value per share | 20.65 | $ | 20.81 |
All values are in US Dollars.
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Consolidated Statements of Operations (unaudited)
(In thousands, except share amounts)
| For the Three Months Ended | ||||||
|---|---|---|---|---|---|---|
| March 31, 2025 | March 31, 2024 | |||||
| Investment Income: | ||||||
| From<br>non-controlled/non-affiliated investments: | ||||||
| Interest income | $ | 94,941 | $ | 94,631 | ||
| Payment-in-kind | 4,188 | 2,644 | ||||
| Dividend income | 594 | 565 | ||||
| Other income | 1,695 | 1,261 | ||||
| From non-controlled/affiliated investments: | ||||||
| Interest income | 26 | — | ||||
| Payment-in-kind | 14 | — | ||||
| Total investment income | 101,458 | 99,101 | ||||
| Expenses: | ||||||
| Interest and other financing expenses | 34,179 | 27,260 | ||||
| Management fees | 9,618 | 8,230 | ||||
| Income based incentive fees | 9,843 | 11,336 | ||||
| Professional fees | 1,608 | 1,217 | ||||
| Directors’ fees | 129 | 146 | ||||
| Administrative service fees | 60 | 25 | ||||
| General and other expenses | 182 | 108 | ||||
| Total expenses | 55,619 | 48,322 | ||||
| Management fees waiver (Note 3) | (641 | ) | (3,098 | ) | ||
| Incentive fees waiver (Note 3) | (375 | ) | (1,210 | ) | ||
| Net expenses | 54,603 | 44,014 | ||||
| Net investment income (loss) before taxes | 46,855 | 55,087 | ||||
| Excise tax expense | 627 | 436 | ||||
| Net investment income (loss) after taxes | 46,228 | 54,651 | ||||
| Net realized and unrealized gain (loss): | ||||||
| Realized gain (loss): | ||||||
| Net realized gain (loss) on<br>non-controlled/non-affiliated investments | 562 | (5,625 | ) | |||
| Foreign currency and other transactions | (13 | ) | — | |||
| Net realized gain (loss): | 549 | (5,625 | ) | |||
| Net change in unrealized appreciation (depreciation): | ||||||
| Net change in unrealized appreciation (depreciation) on non-controlled/non-affiliated investments | (17,148 | ) | 2,658 | |||
| Net change in unrealized appreciation (depreciation) on<br>non-controlled/affiliated investments | 42 | — | ||||
| Translation of assets and liabilities in foreign currencies | (1 | ) | — | |||
| Net unrealized appreciation (depreciation) | (17,107 | ) | 2,658 | |||
| Net realized and unrealized gain (loss) | (16,558 | ) | (2,967 | ) | ||
| Net increase (decrease) in net assets resulting from operations | $ | 29,670 | $ | 51,684 | ||
| Net investment income (loss) per share (basic and diluted) | $ | 0.52 | $ | 0.63 | ||
| Earnings per share (basic and diluted) | $ | 0.34 | $ | 0.59 | ||
| Weighted average shares outstanding: | 88,413,652 | 87,358,527 |
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