A consortium of private credit investors, including Antares Capital, KKR, BlackRock, and Carlyle Group, is preparing to convert debt into equity at 48Forty Solutions, roughly a year after backing Summit Partners’ $1.75bn acquisition of the pallet company, according to a report by Bloomberg citing unnamed sources familiar with the matter.
Under the plan, which is expected to close by year-end, the group would swap a substantial portion of the company’s debt for ownership stakes while injecting an additional $75m of new debt to support operations. The move would cut roughly $1bn from 48Forty’s liabilities, helping stabilise the balance sheet.
The proposed deal also includes board representation for the private credit lenders. Antares and KKR are expected to each appoint two directors, Carlyle and BlackRock will jointly appoint one, and first-lien lenders will agree on another seat. The company’s CEO will retain a seat on the board.
48Forty, which operates 73 pallet recycling and management facilities across the US and Canada, had been struggling with interest payments, previously paying much of the interest in kind and ceasing cash interest payments in August. FS KKR Capital Corp, a KKR-managed fund, marked down the value of its loan to 46 cents on the dollar in Q3 2025, highlighting the stress on the capital structure.
The transaction exemplifies a growing trend in private credit, where lenders are taking equity positions in distressed portfolio companies to protect returns and potentially capture upside. Cost-cutting measures, including possible plant closures, are expected to be part of the turnaround strategy once the board is reconstituted.
48Forty’s private credit backers have been financing the company since Summit’s acquisition in 2022, underscoring the increasing role of private credit and PE firms in actively managing and restructuring mid-market businesses.
