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FS Investment, two special-purpose subsidiaries secure $400 million debt financing from Goldman Sachs
By Lisa Kerner
Charlotte, N.C., Dec. 19 – FS Investment Corp. II, through two special-purpose financing subsidiaries, entered into a $400 million debt financing arrangement on Dec. 15 with Goldman Sachs Bank USA.
The financing will be used to fund investments and for other general corporate purposes, according to a form 8-K filed with the Securities and Exchange Commission.
Under the sale and contribution agreement, FSIC II has contributed a portfolio of assets valued at about $169 million to Green Creek LLC, a newly formed, special-purpose subsidiary of FSIC II with a total value of about $169 million.
These assets will secure the obligations of Green Creek under floating rate notes to be issued from time to time by Green Creek to Schuylkill River LLC, another newly formed, special-purpose subsidiary of FSIC II, pursuant to an indenture with Citibank, NA as trustee, the filing stated.
The total amount of notes that may be issued by Green Creek from time to time is $690 million. Schuylkill River will purchase the notes issued by Green Creek from time to time at a purchase price equal to their par value.
Interest on the notes under the indenture will accrue at Libor plus 400 basis points.
Principal and any unpaid interest on the notes will be due and payable on the maturity date of Feb. 15, 2026.
Schuylkill River, in turn, has entered into a repurchase transaction with Goldman under which Goldman will purchase notes held by Schuylkill River beginning Dec. 15 to, but excluding, March 15.
The purchase price of the notes will be equal to 58% of the principal amount of notes purchased with a maximum purchase of $690 million.
On Dec. 15, Goldman purchased a $130 million note from Schuylkill for $75.4 million. Schuylkill River will repurchase notes sold to Goldman no later than Dec. 15, 2018.
FS Investment is a business development company based in Philadelphia.
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