Onex Direct Lending BDC Fund 8-K

What Happened
Onex Direct Lending BDC Fund filed an 8-K (Regulation FD disclosure and Other Events) reporting its net asset value (NAV) per share as of December 31, 2025 was $20.81, down from $21.53 at September 30, 2025. The quarter-over-quarter NAV decline was driven primarily by unrealized losses concentrated in four portfolio companies (three Level 3 assets valued by an independent third party and one Level 2). The company declared a quarterly dividend of $0.54 per share (annualized distribution yield of 10.38% based on Q4 NAV) and reported quarterly and year-to-date returns of -0.84% and -1.88%, respectively.

Key Details

• NAV per share (12/31/2025): $20.81; aggregate NAV: $194.1 million.
• Portfolio fair value: $395.4 million across 57 companies in 18 industries; unfunded commitments: $17.3 million.
• Dividend and yield: Q4 distribution $0.54/share; annualized yield 10.38% (based on Q4 NAV).
• Capital and leverage: net leverage ratio 1.08x (within 0.75x–1.25x target); remaining facility capacity totaling $161.0 million.
• Portfolio makeup and credit metrics: 97% first‑lien and 98% floating‑rate (by par, including funded/unfunded); weighted average portfolio spread 531 bps; weighted average spread at commitment ~591 bps.
• Activity: closed 3 new borrowers and 5 exits in Q4; 90% of loans (by fair value) priced above $0.85 on the dollar; two investments on non‑accrual (unchanged).
• Private Offering: as of the filing the company sold 14,505,946 common shares for total consideration of $359.8 million and intends to continue quarterly sales in the private offering.

Why It Matters
This filing gives investors an updated snapshot of the fund’s NAV, portfolio valuation, income distribution and liquidity. The NAV decline was driven by unrealized markdowns concentrated in a small number of holdings (not broad portfolio deterioration), while key risk metrics — first‑lien and floating‑rate concentration and leverage of 1.08x — remained within stated targets. The ongoing private offering has generated material capital ($359.8M to date), which affects the company’s equity base and available capital for investments. Investors should note the continued two non‑accruals and moderate negative quarterly/YTD returns when assessing near‑term performance and yield sustainability.