Platinum Equity’s Credit Team Combines Flexible Capital with an Operator’s Perspective

As private credit navigates an evolving economic backdrop, Platinum Credit is building its franchise around flexibility, operational insight and the ability to address financing needs that do not neatly fit into a standardized lending model.

The approach draws upon Platinum Equity’s three decades of investing and operating experience. That perspective helps the credit team understand businesses more deeply and craft customized financing solutions for acquisitions, refinancings, growth initiatives and shareholder liquidity needs.

“The best capital solutions aren’t built around rigid rules — they’re built around understanding businesses and solving problems,” Platinum Equity Co-Presidents Jacob Kotzubei and Louis Samson say of the firm’s credit business. “Our industry expertise and commitment to partnership allow us to deliver thoughtful, customized capital solutions.”

For Michael Fabiano, Platinum Equity’s Global Head of Credit, that differentiation begins long before a loan is made. Platinum’s credit platform grew organically from the firm’s private equity business after repeatedly encountering strong companies that needed capital — not new owners — to pursue their objectives.

“We were approached by good businesses with compelling opportunities that did not want dilutive equity capital,” Fabiano said earlier this year. “We realized we could provide the capital they needed to pursue strategic or operational initiatives while allowing owners and management teams to remain in control. And, when useful, they could also draw on Platinum’s experience and resources.”

“That’s how the credit business has evolved.”

That evolution has helped shape a credit business focused on middle-market companies whose size or financing objectives often require a more customized solution than traditional banking or broadly syndicated markets are designed to provide. Platinum Credit has financed business like RELAM, a specialty rental equipment provider serving the railroad industry, and Mellott, an integrated provider of aggregates processing services and equipment.

The credit business is integrated into the broader firm, with credit professionals working alongside operators from the earliest stages of due diligence. Together, they evaluate a borrower’s ability to repay, the operational drivers of performance and the company’s plans for growth and improvement. Fabiano argues that this deeper understanding supports more informed underwriting, more flexible financing structures and more constructive partnerships through changing market conditions.

That approach comes at a time when financing costs, inflationary pressures and longer hold periods are reshaping demand for private credit.

Here are more of Fabiano’s thoughts on Platinum Credit.

(Questions and answers have been edited for length and clarity).

What does private credit look like at Platinum?

Fabiano: It is an extension of how the firm has invested for over 30 years. We lend to middle-market companies with strong underlying businesses and opportunities to grow, improve or navigate a transition. We bring the same sourcing network, depth of diligence and operating resources that Platinum has historically applied in private equity, but we use those capabilities to provide thoughtful, customized credit solutions.

We lend like credit investors, but we underwrite like owners. We are not just asking whether a company can service its debt. We want to understand what is really happening inside the business, what management is trying to accomplish, and which operational levers support performance across a range of scenarios.

How is Platinum Credit different from other lenders?

Fabiano: A big difference is that we do not view credit underwriting as primarily a financial modeling exercise. Financial analysis is important, but it is only part of understanding the risk. We spend a lot of time evaluating the actual operations of the business — its customers, facilities, pricing, procurement, systems and cost structure.

Our investment professionals and operators collaborate from the beginning of diligence. That joint approach helps us ask better questions, identify risks and opportunities earlier and evaluate situations that may not fit into a standardized lending framework.

Q: How does that operational expertise benefit borrowers?

Fabiano: The first benefit is that we invest the time to understand their businesses and what management and ownership are trying to accomplish. That is particularly valuable when a financing need involves an acquisition, a refinancing, a growth initiative or another situation that requires more judgment and customization than simply applying a leverage multiple.

After an investment, management and ownership remain in control. Our role is to be a constructive and informed capital partner. When invited, we can connect companies with resources across Platinum in areas such as pricing, procurement, supply chain, manufacturing, technology and human capital. Those capabilities are available to support management’s plan, not to replace it.

Q: How would you describe Platinum Credit’s investment philosophy?

Fabiano: The best credit investors should understand a business with the depth and perspective of an owner while maintaining the discipline of a lender. Before we invest, we want to understand not only how the company performs today, but also management’s plan for growth and improvement.

We focus on companies with durable underlying attributes and seek to structure investments with appropriate contractual returns and lender protections. Ultimately, our goal is to generate attractive risk-adjusted returns by combining disciplined credit structuring with private-equity-style diligence and operational insight, while providing borrowers with capital designed around their specific objectives.

Q: How has the current market created opportunities for private credit?

Fabiano: Today’s environment presents both challenges and opportunities for borrowers. Higher financing costs, inflation, geopolitical uncertainty and technological disruption are creating new demands on management teams and influencing how companies think about capital.

One important consequence has been longer holding periods for business owners. Companies that might previously have pursued a sale may instead seek capital to refinance existing debt, fund acquisitions, invest in growth or provide shareholder liquidity while preserving strategic flexibility.

Q: How does Platinum’s broader platform strengthen the credit business?

Fabiano: We benefit from the firm’s global sourcing network, sector knowledge, and approximately 90 in-house operating professionals. That allows us to see a broad range of opportunities, move efficiently when we have conviction and bring specialized resources into diligence.

We also gain institutional knowledge that is difficult to replicate within a standalone credit manager. Often, Platinum has previously owned, diligenced or operated businesses in the same sector as a prospective borrower. That experience helps us ask better questions, identify risks and opportunities earlier and develop a more informed view of the business. The credit strategy has its own dedicated team and investment process, but it is strengthened every day by its integration with the broader firm.