KBRA Affirms Ratings for HPS Corporate Capital Solutions Fund
7 Apr 2026 | New York
KBRA affirms the issuer and senior unsecured debt ratings of BBB for HPS Corporate Capital Solutions Fund ("HCAP" or the "company"). The rating Outlook is Stable.
Key Credit Considerations
The ratings are supported by HCAP's ties to HPS Investment Partners, LLC ("HPS"), a subsidiary of BlackRock Inc., which together with other strategies formed Private Financing Solutions, overseeing $381 billion of assets under management (AUM) as of 4Q25. HCAP benefits from HPS's sourcing through well developed sponsor/non-sponsor relationships, underwriting, portfolio management, capital markets, and SEC exemptive relief to co-invest alongside certain other affiliated entities. The company is led by an experienced team with a long track record working within the private debt markets with founding partners having an average of 30+ years of industry experience. Furthermore, as of December 31, 2025, the company had a diversified $2.2 billion investment portfolio at fair value (FV) consisting of 188 portfolio companies with 82.4% comprised of senior secured first lien loans. The top 3 sectors include Software (13.9%), Health Care Providers & Services (10.2%), and Independent Power and Renewable Electricity Producers (9.8%). As of December 31, 2025, the investment portfolio is comprised mostly of senior secured first lien loans (82%) with a weighted average portfolio company EBITDA of $229 million. The company had one portfolio company on non-accrual comprising 0.3% and 0.3% of total investments at FV and cost, respectively.
As of December 31, 2025, HCAP maintained gross leverage of 0.74x, lower than its target leverage range of a conservative 0.75x to 1.0x. HCAP's target leverage is somewhat lower than its peers, but appropriate due to its target portfolio mix which includes a portion of junior capital and, to a lesser extent, opportunistic credit. As a perpetual-life BDC, HCAP currently raises equity monthly and offers to repurchase shares on a quarterly basis, subject to the discretion of the company's Board of Trustees. From HCAP's inception to December 31, 2025, the company raised ~ $1.25 billion of equity, including reinvested distributions, and had just $47 million net of early repurchase deduction fee. Furthermore, the company announced that approximately 2.3% of its outstanding common shares as of December 31, 2025 were validly tendered and not withdrawn with respect to HCAP's offer to purchase shares under its share repurchase program for 1Q26.
In 2025, the company improved its funding profile with the addition of senior unsecured notes ($350 million) and an increase in its committed revolving credit line to $1.125 billion from $650 million at YE 2024. Senior unsecured debt to total debt was solid at 37.7%, improving financial flexibility and lowering asset encumbrance for the benefit of the unsecured noteholders. As of 4Q25, HCAP had adequate liquidity with $546 million of available credit and $24 million of unrestricted cash and cash equivalents with no near-term maturities and $247 million of unfunded commitments.
Counterbalancing HCAP's credit strengths are the company's limited operating history (primarily offset by the long tenure of its management team), unseasoned investment portfolio, relatively illiquid investments, retained earnings constraints as HCAP intends to elect to be treated for federal income tax purposes as a regulated investment company ("RIC"), and uncertain economic environment with high base rates, inflation, and geopolitical risk.
Formed in August 2023 as a Delaware statutory trust, HPS Corporate Capital Solutions Fund is a perpetual-life, externally managed, non-diversified closed-end investment management company regulated as a Business Development Company ("BDC") under the Investment Company Act of 1940. The company commenced operations in April 2024. HCAP is externally managed by HPS Advisors, LLC, a wholly-owned subsidiary of HPS Investment Partners, LLC. In December 2024, BlackRock Inc. (NYSE: BLK) entered into an agreement to acquire HPS Investment Partners, LLC. The acquisition was completed on July 1, 2025. Private Financing Solutions, of which HPS is now a part, had 1,300 employees and 600+ investment professionals as of September 30, 2025.
Rating Sensitivities
Given the Stable Outlook, a rating upgrade is not expected in the near to medium term. A rating down downgrade and/or Outlook change to Negative could be considered if there is a significant downturn in the U.S. economy with negative impact on HCAP's earnings performance, asset quality, and earnings. A significant change in senior management and/or risk management policies could also lead to negative rating action.
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