West Bay BDC Assets Triple on Investment & Debt Surge

TL;DR

**West Bay BDC is aggressively expanding its portfolio, signaling strong growth potential despite increased leverage – a bullish move.**

AI Summary

West Bay BDC LLC reported a significant increase in total assets to $302.66 million as of September 30, 2025, up from $107.94 million at December 31, 2024, primarily driven by a substantial increase in investments and debt. The company's investments at fair value grew from $34.10 million to $262.61 million for non-controlled/non-affiliated investments. Net investment income for the nine months ended September 30, 2025, was $2.66 million, a stark improvement from a net investment loss of $1.70 million for the same period in 2024. Total investment income surged to $9.26 million for the nine months ended September 30, 2025, compared to just $2 thousand in the prior year, reflecting increased portfolio activity. Debt increased from $45.00 million to $168.00 million, supporting the growth in investments. The company also issued $69.53 million in common units during the nine months ended September 30, 2025, significantly boosting members' capital to $132.94 million from $62.31 million. Despite a net change in unrealized depreciation of $325 thousand, the company achieved a net increase in members' capital from operations of $2.33 million for the nine-month period. Distributions to members totaled $1.23 million, or $0.25 per unit, for the nine months ended September 30, 2025.

Why It Matters

This significant growth in West Bay BDC LLC's assets and investment income signals a robust expansion phase, which is crucial for investors seeking income-generating opportunities in the BDC space. The substantial increase in debt and common unit issuance indicates strong capital deployment, potentially leading to higher future returns, but also elevates financial leverage. For employees, this growth suggests stability and potential expansion, while customers of West Bay's portfolio companies benefit from continued investment. In the broader market, this expansion highlights ongoing demand for private credit, intensifying competition among BDCs and potentially influencing lending rates for middle-market companies.

Risk Assessment

Risk Level: medium — The company's debt increased from $45.00 million to $168.00 million, representing a 273% increase, which significantly raises its financial leverage. While this debt supports substantial investment growth, it also exposes West Bay BDC LLC to higher interest rate risk and repayment obligations, as evidenced by interest and other debt expenses rising from $42 thousand to $4.28 million year-over-year for the nine-month period.

Analyst Insight

Investors should closely monitor West Bay BDC LLC's debt-to-equity ratio and the performance of its underlying portfolio companies, particularly those with PIK interest, to assess the sustainability of its growth. Consider this BDC for its income potential, but be aware of the increased leverage and associated risks before making a significant investment.

Financial Highlights

debt To Equity

1.26

revenue

$9.26M

operating Margin

N/A

total Assets

$302.66M

total Debt

$168.00M

net Income

$2.66M

eps

$0.35

gross Margin

N/A

cash Position

$4.29M

revenue Growth

N/A

Revenue Breakdown

Key Numbers

• $302.66M — Total Assets (Increased from $107.94M at Dec 31, 2024, indicating significant growth.)
• $2.66M — Net Investment Income (For the nine months ended Sep 30, 2025, a turnaround from a $1.70M loss in the prior year.)
• $168.00M — Total Debt (Increased from $45.00M at Dec 31, 2024, reflecting higher leverage.)
• 7,585,578 — Common Units Outstanding (Increased from 3,589,962 at Dec 31, 2024, showing capital raises.)
• $17.52 — Net Asset Value per Unit (Increased from $17.36 at Dec 31, 2024, a modest gain.)
• $9.26M — Total Investment Income (For the nine months ended Sep 30, 2025, a substantial increase from $2K in the prior year.)
• $4.28M — Interest and Other Debt Expenses (For the nine months ended Sep 30, 2025, up from $42K in the prior year due to increased debt.)
• $1.23M — Distributions to Members (For the nine months ended Sep 30, 2025, representing $0.25 per unit.)
• $69.53M — Proceeds from Common Unit Issuance (For the nine months ended Sep 30, 2025, contributing to capital growth.)
• $325K — Net Change in Unrealized Depreciation (For the nine months ended Sep 30, 2025, indicating some portfolio valuation adjustments.)

Key Players & Entities

• West Bay BDC LLC (company) — Registrant
• SEC (regulator) — U.S. Securities and Exchange Commission
• Goldman Sachs Asset Management, L.P. (company) — Investment Adviser
• $302.66 million (dollar_amount) — Total assets as of September 30, 2025
• $107.94 million (dollar_amount) — Total assets as of December 31, 2024
• $2.66 million (dollar_amount) — Net investment income for the nine months ended September 30, 2025
• $1.70 million (dollar_amount) — Net investment loss for the nine months ended September 30, 2024
• $168.00 million (dollar_amount) — Debt as of September 30, 2025
• $45.00 million (dollar_amount) — Debt as of December 31, 2024
• $69.53 million (dollar_amount) — Proceeds from issuance of common units for the nine months ended September 30, 2025

FAQ

Risk Factors

• Increased Leverage [high — financial]: Total debt increased significantly from $45.00 million to $168.00 million. This substantial increase in leverage amplifies financial risk, as higher interest expenses ($4.28 million for nine months ended Sep 30, 2025) can strain profitability, especially if investment income falters.
• Investment Valuation Fluctuations [medium — market]: The company experienced a net change in unrealized depreciation of $325,000 for the nine months ended September 30, 2025. This indicates that the fair value of its investments can decrease, impacting net asset value and potentially leading to realized losses if assets are sold at a lower valuation.
• Dependence on Investment Performance [high — operational]: The company's profitability is heavily reliant on the performance of its investments. A significant portion of its income is derived from interest and dividends from non-controlled/non-affiliated investments, which grew to $9.26 million for the nine months ended September 30, 2025. Any downturn in the performance of these assets would directly impact net investment income.
• Capital Raising Activities [medium — financial]: The company issued $69.53 million in common units during the nine months ended September 30, 2025. While this boosted members' capital, it also dilutes existing unit holders' ownership and may increase the number of units outstanding, impacting per-unit metrics.
• BDC Regulatory Environment [medium — regulatory]: As a Business Development Company (BDC), West Bay BDC LLC is subject to specific regulations regarding its investment activities, leverage, and distributions. Changes in these regulations could impact its business model and profitability.

Industry Context

West Bay BDC LLC operates within the Business Development Company (BDC) sector, which focuses on providing capital to small and medium-sized businesses. This sector is characterized by its role in facilitating growth for companies that may have difficulty accessing traditional financing. BDCs often employ leverage to enhance returns, making them sensitive to interest rate environments and market volatility.

Regulatory Implications

As a BDC, West Bay BDC LLC is subject to regulations that govern its investment activities, leverage limits, and distribution requirements. Compliance with these regulations is crucial for its continued operation and ability to provide returns to investors. Changes in BDC regulations could impact its strategic flexibility and profitability.

What Investors Should Do

1. Monitor Debt Levels and Interest Coverage
2. Analyze Investment Portfolio Performance
3. Evaluate Capital Raising Strategy
4. Assess Net Investment Income Sustainability

Key Dates

• 2025-09-30: Quarterly Report Filing (10-Q) — Provides updated financial performance and condition for the period ending September 30, 2025, including significant asset and debt growth.
• 2025-09-30: End of Nine-Month Period — Key period for evaluating year-to-date performance, including substantial increases in investment income and total assets.
• 2024-12-31: Previous Fiscal Year End — Baseline for comparison, showing total assets of $107.94 million and total debt of $45.00 million.
• 2024-05-01: Company Inception — Marks the beginning of operations for West Bay BDC LLC.

Glossary

BDC

Business Development Company. A type of closed-end investment company that invests in small and medium-sized businesses and provides capital to them. (West Bay BDC LLC operates under this structure, implying specific regulatory and investment strategies.)

Investments at fair value

Assets held by the company that are valued based on their current market price, rather than their original cost. (Represents the largest asset category for West Bay BDC LLC, showing significant growth to $262.61 million.)

Net investment income (loss)

The profit or loss generated from a company's core investment activities, after deducting operating expenses. (Shows a significant turnaround for West Bay BDC LLC, moving from a loss of $1.70 million to a gain of $2.66 million for the nine-month period.)

Common units

The basic form of ownership in a limited liability company, similar to shares of stock in a corporation. (The number of outstanding common units increased significantly, indicating capital raises and potential dilution.)

Net asset value per unit

The total value of a company's assets minus its liabilities, divided by the number of outstanding units. (Provides a per-unit measure of the company's intrinsic value, which saw a modest increase.)

Unrealized depreciation

A decrease in the fair value of an investment that has not yet been sold. (Indicates a negative adjustment to the value of the company's investment portfolio.)

Year-Over-Year Comparison

Compared to the prior year's nine-month period, West Bay BDC LLC has demonstrated substantial growth and a significant turnaround in profitability. Total assets have surged from $107.94 million to $302.66 million, primarily due to a massive expansion in investments and a corresponding increase in debt from $45.00 million to $168.00 million. Net investment income has dramatically improved from a loss of $1.70 million to a gain of $2.66 million, driven by a near-complete absence of investment income in the prior year ($2 thousand) compared to $9.26 million in the current period. This growth has been supported by substantial capital raises, evidenced by the issuance of $69.53 million in common units and an increase in outstanding units from 3.59 million to 7.59 million.

Filing Documents

• ck0002020354-20250930.htm (10-Q) — 3464KB
• ck0002020354-ex31_1.htm (EX-31.1) — 15KB
• ck0002020354-ex31_2.htm (EX-31.2) — 15KB
• ck0002020354-ex31_3.htm (EX-31.3) — 15KB
• ck0002020354-ex32_1.htm (EX-32.1) — 8KB
• ck0002020354-ex32_2.htm (EX-32.2) — 7KB
• ck0002020354-ex32_3.htm (EX-32.3) — 8KB
• 0001193125-25-277562.txt ( ) — 12480KB
• ck0002020354-20250930.xsd (EX-101.SCH) — 1112KB
• ck0002020354-20250930_htm.xml (XML) — 2615KB

Financial Statements (Unaudited)

Financial Statements (Unaudited) 4 4 5 6 7 Schedule of Investments 8 Notes to the Financial Statements 12 ITEM 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 26 ITEM 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 37 ITEM 4.

Controls and Procedures

Controls and Procedures 37 PART II OTHER INFORMATION 38 ITEM 1.

Legal Proceedings

Legal Proceedings 38 ITEM 1A.

Risk Factors

Risk Factors 38 ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds 38 ITEM 3. Defaults Upon Senior Securities 38 ITEM 4. Mine Safety Disclosures 38 ITEM 5 Other Information 38 ITEM 6. Exhibits 38

SIGNATURES

SIGNATURES 40 2 Table of Contents CAUTIONARY STATEMENT REGARDIN G FORWARD-LOOKING STATEMENTS This report contains forward-looking statements that involve substantial risks and uncertainties. You can identify these statements by the use of forward-looking terminology such as "may," "will," "should," "expect," "anticipate," "project," "target," "estimate," "intend," "continue" or "believe" or the negatives of, or other variations on, these terms or comparable terminology. You should read statements that contain these words carefully because they discuss our plans, strategies, prospects and expectations concerning our business, operating results, financial condition and other similar matters. We believe that it is important to communicate our future expectations to our investors. Our forward-looking statements include information in this report regarding general domestic and global economic conditions, our future financing plans, our ability to operate as a business development company ("BDC") and the expected performance of, and the yield on, our portfolio companies. There may be events in the future, however, that we are not able to predict accurately or control. The factors listed under "Risk Factors" in our annual report on Form 10-K for the year ended December 31, 2024, as well as any cautionary language in this report, provide examples of risks, uncertainties and events that may cause our actual results to differ materially from the expectations we describe in our forward-looking statements. The occurrence of the events described in these risk factors and elsewhere in this report could have a material adverse effect on our business, results of operations and financial position. Any forward-looking statement made by us in this report speaks only as of the date of this report. Factors or events that could cause our actual results to differ from our forward-looking statements may emerge from time to time, and it is not possible for us to predict all of the

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS West Bay BDC LLC (in thousands, except unit and per unit amounts) September 30, 2025 December 31, 2024 (Unaudited) Assets Investments, at fair value Non-controlled/non-affiliated investments (cost of $ 262,940 and $ 34,111 ) $ 262,608 $ 34,104 Investments in affiliated money market fund (cost of $ 32,797 and $ 68,997 ) 32,797 68,997 Cash 4,289 2,054 Interest and dividends receivable 1,513 47 Deferred financing costs 1,281 2,205 Deferred offering costs — 428 Other assets 169 103 Total assets $ 302,657 $ 107,938 Liabilities Debt $ 168,000 $ 45,000 Interest and other debt expenses payable 1,057 204 Management fees payable 379 69 Accrued deferred offering costs — 37 Accrued organization costs — 25 Accrued expenses and other liabilities 284 292 Total liabilities $ 169,720 $ 45,627 Commitments and contingencies (Note 7) Members' capital Preferred units ( no units issued and outstanding) $ — $ — Common units ( 7,585,578 and 3,589,962 units issued and outstanding as of September 30, 2025 and December 31, 2024) 132,631 63,106 Distributable earnings (loss) 306 ( 795 ) Total members' capital $ 132,937 $ 62,311 Total liabilities and members' capital $ 302,657 $ 107,938 Net asset value per unit $ 17.52 $ 17.36 The accompanying notes are an integral part of these unaudited financial statements. 4 Table of Contents West Bay BDC LLC (in thousands, except unit and per unit amounts) (Unaudited) For the Three Months Ended For the Nine Months Ended For the period from May 1, 2024 (inception) to September 30, 2025 September 30, 2024 September 30, 2025 September 30, 2024 Investment income: From non-controlled/non-affiliated investments: Interest income $ 4,644 $ — $ 8,750 $

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