Debt Advisory Insights | June 2026
Private Debt
The third pillar alongside bank lending and capital markets in the European mid-market
Private debt has evolved from a specialised financing instrument into a core pillar of corporate finance. Global private debt AUM increased from around USD 600bn in 2014 to more than USD 2.4tn in 2025. With approximately EUR 400bn in AUM, Europe is now the second-largest private debt market worldwide.
Our Oaklins Germany Debt Advisory Insight “Private Debt 2026” explores what this development means for mid-market companies, entrepreneurs and financial investors.
Private debt is not the right solution at any cost. Used selectively and with the right structure, however, it can significantly expand strategic financing options – particularly where traditional bank financing reaches structural limits.
The report focuses on:
- the development of the private debt market in Europe and globally
- the key structures, ranging from senior secured and unitranche to mezzanine financing
- typical use cases, including M&A, buyouts, growth, investments, refinancings and restructurings
- the opportunities and risks for borrowers
- the key differences between bank financing and private debt
Direct lending, in particular, has become an established financing instrument. Accounting for 52% of global private debt AUM, it is now a relevant tool for M&A, buyouts and growth financing in the mid-market.
At the same time, the report provides a transparent assessment of the limitations: higher capital costs, prepayment penalties, covenant pressure, refinancing risks and increased transaction complexity all need to be considered at an early stage.
The Berner Group case study illustrates how private debt can work in practice. Oaklins structured a tailored EUR 20m private debt financing for a complex value-add project that was only partially financeable through banks. The structure comprised three tranches, a two-year maturity, a fixed interest rate of 6.25% p.a. and only around 1% cash equity.
The decisive question is not whether private debt or bank financing is fundamentally better. What matters is which structure makes the specific transaction possible – and how professionally the process is prepared, structured and negotiated.
Oaklins supports companies in identifying the right financing partner, creating genuine competition between capital providers and negotiating tailored structures aligned with their strategic objectives.
Next step: Let us assess in a confidential discussion whether and how private debt could create additional financing headroom for your business.
Schedule a meeting now: Calendly - Torsten Aul
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