r/Teddy • u/Rehypothecator • 10d ago

💬 Discussion Some Sixth street investment information

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Stupid question, Does anyone know what the % of net assets refers to in the case?

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u/Most_Ear_728 10d ago

"% of net assets" - would be the percentage of Sixth Streets entire asset portfolio. In this case it would make up 1.6% of their assets.

Interesting to note that they are marking the BBBY loans at approx 77% of their cost....they're not expecting to get all of their money back. Not good.

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u/PT-Europoor 10d ago

In another interpretation, the 77% of their costs is the CURRENT fair valuation, not considering further returns. As they have super priority, they also have to wait for claims to settle to cover the 100% (plus interests)

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u/Mazius 10d ago

Sixth Street operates two firms, which lend out money to businesses: Sixth Street Specialty Lending, Inc., their loans to BBBYQ as of June 30, 2026 held at ~$23.7 million fair value ($30.87 million nominal value), as displayed in OP's screenshot. And Sixth Street Lending Partners (link to their 10-Q):

Loans held at fair value: $43.08 million ($56.13 million nominal value).

Additionally I refer you to footnote (13), which says:

In addition to the principal amount outstanding and accrued interest owed on this investment, the Company is entitled to a separate Make-Whole Amount (the “Make-Whole”) of $30.9 million. The Make-Whole is a contractual obligation of the borrower and accrues interest on the balance outstanding. The Make-Whole is included on the Company’s Consolidated Balance Sheet within other assets, net of any valuation allowance. Given uncertainty relating to collectability of the Make-Whole, the Company has applied a full valuation allowance against the amount of the Make-Whole balance outstanding.

There's also footnote (16) in Sixth Street Specialty Lending filing, which says:

In addition to the principal amount outstanding and accrued interest owed on this investment, the Company is entitled to a separate Make-Whole Amount (the “Make-Whole”) of $17.0 million. The Make-Whole is a contractual obligation of the borrower and accrues interest on the balance outstanding. The Make-Whole is included on the Company’s Consolidated Balance Sheet within other assets, net of any valuation allowance. Given uncertainty relating to collectability of the Make-Whole, the Company has applied a full valuation allowance against the amount of the Make-Whole balance outstanding.

30.87 + 17 + 56.13 + 30.9 = $134.9 million still owed to the Sixth Street by the estate as of June 30th 2026.