Morgan Stanley Direct Lending Fund (NYSE: MSDL) is a business development company (BDC) that lends directly to U.S. middle-market companies owned by private equity sponsors. It makes money primarily through interest income on floating-rate, directly originated senior secured term loans. MSDL is externally managed by an indirect wholly owned subsidiary of Morgan Stanley (NYSE: MS) and operates within Morgan Stanley's MS Private Credit platform, which managed approximately $23.0 billion in committed capital under its Direct Lending strategy as of February 1, 2026. As of December 31, 2025, MSDL held investments in 227 portfolio companies across 35 industries, with approximately 99.6% of its debt portfolio in floating-rate instruments. The fund targets companies with annual EBITDA of roughly $15 million to $200 million, focusing on first lien senior secured loans and maintaining typical loan-to-value ratios of up to 60%. MSDL is incorporated in Delaware, regulated as a BDC under the Investment Company Act of 1940, and elected RIC status for U.S. federal income tax purposes.

Revenue model

Interest income on directly originated, floating-rate senior secured loans to U.S. middle-market companies. Approximately 99.6% of the debt portfolio bore floating interest rates as of December 31, 2025. The fund also holds secondary positions in second lien loans, mezzanine notes, and equity co-investments, which may generate capital appreciation.

Products and services

Directly originated first lien senior secured term loans (primary); second lien senior secured loans; mezzanine notes; unsecured debt; preferred stock; common stock investments in U.S. middle-market companies backed by private equity sponsors.

Customers and end markets

U.S. middle-market companies with annual EBITDA of approximately $15 million to $200 million that are majority-owned by private equity sponsors. Portfolio spans 35 industries as of December 31, 2025, with 227 portfolio companies. Limited international exposure in jurisdictions such as Canada and the United Kingdom.

Value-chain role

Direct lender and capital provider. Originates and structures loans directly to borrowers rather than purchasing syndicated loans on the secondary market. Relies on Morgan Stanley's relationships with private equity sponsors, commercial and investment banks, and financial intermediaries for deal sourcing.

Geographic exposure

Primarily United States. International investments permitted in limited jurisdictions with established creditor-rights frameworks, including Canada and the United Kingdom.

Source: SEC 10-K, filed 2026-02-26

Industry: UNKNOWN