Tony Yoseloff warns AI threatens software private debt recovery
Updated
Updated · Bloomberg · May 5
Tony Yoseloff warns AI threatens software private debt recovery
3 articles · Updated · Bloomberg · May 5
Speaking at the Milken Institute Global Conference, the Davidson Kempner CIO said average first-lien debt recovery over the past five years was already below 40 cents.
He said software companies could recover even less because they have few hard assets to underpin valuations once business performance weakens.
The warning highlights a growing risk for private credit investors in software as AI-driven disruption pressures borrowers and could erode lenders' recoveries in distress.
As AI erases software value, is the $1.8 trillion private credit market heading for its own 2008-style crisis?
With software loans now in 401(k) plans, are AI's disruptions secretly putting your retirement savings at risk?