Sixth Street Specialty Lending

Sixth Street Specialty Lending lends money to mid-sized American companies to help them grow. These businesses use the money to buy other companies or expand their operations. The firm acts as a specialized lender for companies that need flexible funding.

What Is in the Portfolio?

• First-Lien Debt: Loans that have the first right to a company's assets if it cannot pay its debts.
• Unitranche Loans: Credit agreements that combine different types of debt into one single loan for a borrower.
• Mezzanine Debt: Loans that sit between senior debt and company ownership in the order of repayment.
• Equity Investments: Ownership stakes in businesses that the company usually holds alongside its lending deals.
• Structured Credit: Specialized investments in groups of corporate loans, including collateralized loan obligations.

New Partners and Programs

• Formed a joint venture with Carlyle Group Inc. in December 2025 to invest in secured corporate loans.
• Received an order from regulators in May 2025 allowing the firm to invest alongside its own affiliates.
• Increased focus on the internet services industry, which made up 18.3% of the portfolio by December 2025.

Finding the Best Deals

The company finds its own lending opportunities instead of using middlemen like investment banks. It uses a five-point internal scale to monitor the financial health of every business it lends to. This process helps the firm identify and manage risks across its various industry investments.

The Financial Scorecard

• Total investment portfolio reached $3.35 billion as of December 31, 2025.
• Operating income rose to $59 million in Q4 2025, up 10.7% from the previous year.
• Net income fell to $30 million in Q4 2025, a 41.2% drop year-over-year.
• Asset coverage ratio—a measure of how well assets cover debts—was 191.5% at the end of 2025.

The Big Picture

Sixth Street Specialty Lending has built a diverse portfolio focused on senior debt and direct relationships with borrowers. Its move into joint ventures and co-investing shows a focus on scaling its lending capacity.