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Prospect Capital begins InterNotes program, offers 7% notes due 2022
By Toni Weeks
San Diego, Feb. 21 - Prospect Capital Corp. has begun an InterNotes program, according to a 497 filing with the Securities and Exchange Commission.
The company will sell 7% senior notes due March 15, 2022. Interest is payable semiannually.
The initial offering will be sold through agent Incapital LLC. The notes will price Feb. 27 and settle March 1.
The notes are redeemable in whole or in part at par plus accrued interest on each interest payment date beginning March 15, 2013.
The company said it will sell its Prospect Capital InterNotes in various offerings of up to $500 million from time to time. Each note will mature 12 months or more from its date of issuance.
Proceeds will be used to maintain balance sheet liquidity, which may involve repayment of debt under the company's credit facility, investments in high-quality short-term debt instruments. Thereafter it may be used for long-term investments. Prospect Capital had $172 million outstanding under its credit facility as of Feb. 15, according to the filing.
New York-based Prospect Capital is a closed-end management investment company that lends to and invests in middle market, privately held companies, concentrating on making investments in companies with annual revenues of less than $500 million and enterprise values of less than $250 million. Typically, an investment will involve a secured loan of less than $50 million with some form of equity participation. The company seeks to maximize total returns, including current yield and equity upside, to its investors.
Prospect Capital Management LLC manages the company's investments.
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