CION Ares Diversified Credit Fund Lines Up $150 Million in Preferred Share Financing

The private placement puts new senior capital ahead of common shareholders, but the fund has not yet disclosed the dividend rate or redemption schedule.

October 5, 2026

CION Ares Diversified Credit Fund has agreed to sell $150 million of mandatory redeemable preferred shares to a group of institutional accredited investors. The deal adds fresh senior financing to the interval fund, which CION Investments and Ares Management co-manage.

The agreement, signed October 2, 2026, covers two new series of preferred stock, each with a liquidation preference of $25.00 per share:

• 4,000,000 Series M Mandatory Redeemable Preferred Shares
• 2,000,000 Series N Mandatory Redeemable Preferred Shares

The shares are being sold in a private placement exempt from registration under the Securities Act of 1933, separate from the fund's continuous public offering of common shares.

Two Closings, Two Months Apart

The sale is split into two closings. The Series M closing took place the same day the agreement was signed and brought the fund $100 million in gross proceeds. The Series N closing is expected no later than December 2, 2026, if customary closing conditions are met. Once both closings are complete, the fund expects total gross proceeds of $150 million.

The fund disclosed the transaction in a supplement to the prospectuses and statement of additional information for its Class A, Class C, Class I, Class L, Class U, Class U-2 and Class W shares.

What the Disclosure Leaves Out

The supplement is brief. It does not give the dividend rate on either series, the dates when the shares must be redeemed, who the purchasers are, or how the fund plans to use the proceeds. Those terms matter to common shareholders. Preferred shares rank ahead of common shares in the fund's capital structure, and their dividends generally take priority over distributions to common holders.

Preferred stock is not new to the fund. CION Investments says the fund already uses leverage as part of its strategy, through borrowings under a credit facility and through mandatory redeemable preferred shares. Under the Investment Company Act, preferred shares issued by a registered closed-end fund are senior securities and count against the fund's asset coverage limits.

The fund invests in a globally diversified mix of liquid and illiquid credit assets, with an emphasis on the U.S. and Western Europe. It offers shareholders liquidity through quarterly repurchase offers.