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KBRA Affirms the Rating Assigned to BNP Paribas' Participation in a Revolving Credit Tranche A Facility to Lone Star Fund XII, L.P.

9 Oct 2025   |   London

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KBRA UK (KBRA) affirms the A rating assigned to BNP Paribas' ("BNP") participation in a revolving credit facility's Tranche A ("Tranche A Facility") to Lone Star Fund XII, L.P. ("Fund XII" or the "Fund"). The Outlook is Stable. The Tranche A Facility is provided by a consortium of lenders, including BNP (the "Lenders"). On 29 March 2024, KBRA assigned an A rating to BNP's then $250.0 million commitment to the then $2,100.0 million Tranche A Facility, on a published basis. On 30 September 2024, KBRA affirmed the A rating to BNP's $250.0 million commitment to the then $2,800.0 million Tranche A Facility, on a published basis. The rating was requested by BNP.

As of August 2025, BNP's commitment to the now $2,006.0 million Tranche A Facility is $179.0 million. Since last surveillance, Tranche A Facility's maturity was extended by one year to August 2026. The Lenders have a first priority security interest in the uncalled capital commitments (UCC) of the Fund, including security over the right of the general partner (GP) to make capital calls. The Lenders also benefit from bank account security over the capital call accounts. The revolving credit facility includes an additional tranche, but the Tranche A Facility is senior to this second tranche, with Tranche A Facility repaid firstly. Additionally, this second tranche can only be drawn once Tranche A Facility has been fully drawn.

The rating action reflects the stable credit quality of the Limited Partner (LP) base and the stable performance of Fund XII. The Fund reached its final close in June 2024, raising $5,317.9 million of commitments from 85 LPs. The credit quality of the LPs remains in line with rating issuance and last surveillance. As of July 2025, the Fund has called approximately 42.7% of LP commitments, up from 11.9% at last surveillance. KBRA views the combination of these factors as continued incentive for LPs to continue to meet future capital calls for repayment.

Fund XII is the twelfth vintage fund of Lone Star Global Acquisition, Ltd.'s ("LSGA" of the "Firm") buyout strategy, predominantly targeting industrial investments in corporate debt and equity across Europe. LSGA is a private equity firm that has organized 25 funds with aggregate capital commitments totaling approximately $95.0 billion as of August 2025. The Firm has a global footprint with 11 international offices across North America, Europe and Asia, investing globally, across private equity, credit and real estate, often targeting distressed and mispriced assets.

Key Credit Considerations

Investment fund ratings are based on quantitative and qualitative factors. The five key quantitative determinants are as follows:

  1. In the Asset Quality determinant, KBRA generally measures the quality of the collateral based on a weighted average scoring. For Subscription Facilities (“Sublines”), this includes an assessment using a matrix-based approach that reflects the creditworthiness of the Fund’s LP base.
  2. The Asset Coverage determinant measures the relative sufficiency of the pledged collateral value to repay the principal amount of the rated debt. For Sublines, this includes an evaluation of the covenants included in the Facility linked to UCC and net asset value (“NAV”) of the Fund, and/or advance rates applied to the UCC.
  3. The Liquidity determinant reflects KBRA’s assessment of the relative price discount that the underlying collateral may incur if the assets are subject to conversion into cash in order to meet scheduled or accelerated debt service requirements. Under the Liquidity determinant, KBRA considers three factors (type, complexity and price discovery / transparency) and scores these factors individually on a scale of zero to two, with two being the most liquid.
  4. In the Duration determinant, KBRA examines the tenor profile of the pledged collateral relative to the rated debt, and the associated vulnerability to changes in price of collateral over time.
  5. When appropriate, KBRA will perform a cash flow analysis in order to test the transaction’s ability to meet its rated interest and principal payment obligations under various economic, financial, and market scenarios. This is not applicable to Subscription Facilities, as LP capital calls typically occur on a non-periodic basis and the primary source of repayment for Sublines is the Fund’s UCC so once a capital call is issued, the LP is typically required to meet the capital call within a short window. Therefore, repayment capacity is analysed in the context of the prior rating determinants.

The above quantitative determinants produce a quantitative rating outcome. In addition to the above quantitative determinants, KBRA’s analysis considers a variety of qualitative factors, which can lead to upward or downward adjustments in the final rating outcome and these are assessed in the context of: (i) Manager Review; (ii) Legal Review, and (iii) Other Factors including alignment of interests, incentives to fund future capital calls and diversification within the LP base.

Rating Sensitivities

It should be noted that many aspects, including but not limited to, the rating sensitivities listed below, macroeconomic factors, market conditions, competitive landscape, and a fund manager’s investment acumen can impact the performance of the fund and influence KBRA’s rating decisions. If performance of the transaction differs meaningfully from the expected levels, KBRA may consider making a rating change.

Decline in LP Credit Quality

A decline in the credit quality of the Fund’s LPs as a result of: (i) deterioration in the credit quality of underlying LPs; (ii) transfer of interests to LPs of lower credit quality characteristics; (iii) inclusion of LPs with weak credit quality characteristics; and (iv) weaker than expected LP diversification, may result in negative rating changes.

Improvement in LP Credit Quality

An overall higher credit quality of the Fund’s LPs as a result of: (i) improvement in the credit quality of underlying LPs; (ii) transfer of interests to LPs with better credit characteristics; (iii) inclusion of LPs with strong credit quality characteristics; and (iv) stronger than expected LP diversification, may result in positive rating changes.

Underperformance of Fund Assets or Investments

A decrease in the Fund’s NAV due to underperformance of the Fund’s underlying assets or investments may jeopardise debt repayment as the deterioration of the Fund may, for example, elicit hesitation of the Fund’s LPs to fund their respective capital calls regardless of their contractual obligations to do so and the underlying LPs’ security and protections to the Lender.

To access ratings and relevant documents, click here.

Click here to view the report.

Methodologies

Disclosures

Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

This credit rating is endorsed by Kroll Bond Rating Agency Europe Limited for use in the European Union. Information on a credit rating’s endorsement status is available on its rating page at KBRA.com.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

There are certain issuers, entities or transactions rated by KBRA Europe or KBRA UK that may be or have relationships with Shareholders and/or Shareholder-Related Companies, as that term is defined in KBRA’s Shareholder and Shareholder Related Companies for KBRA Europe and KBRA UK Policy and Procedure. Relevant disclosure information may be found here.

About KBRA UK

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S. Kroll Bond Rating Agency UK is located at 1 Connaught Place, 2nd Floor London, England.

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