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2 min read CION

Lux Credit Consultants

This automotive consultancy was motoring along till a few quarters ago, but has now been sold and a considerable loss recorded by its only BDC lender. It's all a little strange and unexplained.

Latest Update: Company Sold

Lux Credit Consultants LLC operates a dual-model business within the professional consulting and automotive leasing sectors. The company's primary focus is providing bespoke credit restoration and financial lifestyle management services, strategically targeted at affluent consumers. Adjacent to its core consulting operations, the firm manages an automotive equipment rental division that facilitates luxury passenger car leasing. By integrating comprehensive credit consulting with high-end vehicle rentals, the business serves a niche demographic focused on establishing and maintaining a premium lifestyle.

August 31, 2026

CCR 5 Rating Removed.

Like a comet shooting across the night sky, Lux has come and gone in the BDC Credit Reporter. Back in the IIIQ 2026, the company appeared to be performing normally going by the valuation at par of its only BDC lender, CION Investment (CION) and was paying the interest due on its loans due in 2028. One quarter later, those loans were written down by (22%) and the company's rating dropped to a 4 and was briefly made an Important Underperformer given the stated FMV of $17mn on a cost of $21mn.

In the IQ 2026, CION admitted the following:

The principal new addition to nonaccrual status this quarter was Lux Credit Consultants, which was in the midst of a sale process through quarter end. And I'm glad to report that subsequent to quarter close, that sale was successfully completed. As a result, we expect that Lux will be removed from nonaccrual status in Q2....Lux Credit represented our largest decline as the sale process for the company resulted in final bids well below the initial indications of interest based on the company's significant asset base and EBITDA profile.Rather than the lenders restructuring and recapitalizing the company with additional investment, the majority of lenders decided to pursue a cash sale transaction and move on rather than restructure and invest.

The bottom line was that CION's investment was written down to a value of $4mn and placed on non-accrual in the IQ 2026. We removed Lux from the Important Underperformers list due to the FMV being below $5mn. In this most recent quarter - the IIQ 2026 - the investment has been removed from the BDC's list of portfolio investments and a realized loss booked of approximately ($18mn). This has allowed CION to deduct Lux from its non-accrual list.

The percentage of the investment written off is on the high side for a senior debt position and will result in about ($2mn) a year in interest income permanently loss. That amounts to (0.8)% of CION's full year 2025 revenues and (2.2%) of its Net Investment Income. Historically, realized losses have averaged ($32mn) a year, so this was a significant setback. The only good news is that the $4mn of net proceeds received in the IIQ 2026 is available for re-investment.

There's obviously an interesting back story here but neither CION nor the public record are explaining this sudden deterioration and the need for the sale and why offers were below expectations. We are left to wonder.

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