By Stephanie N. Rotondo
Seattle, April 6 – Prospect Capital Corp. sold $225 million of 4.95% convertible senior notes due 2022 with an initial conversion premium of 10%, the company said in a press release on Thursday.
The convertibles were sold at 98% of par, equaling an effective yield of 5.39%.
Pricing terms were in line with talk.
Goldman Sachs & Co. is the bookrunner.
The company can call the convertibles after April 15, 2022 at par plus accrued interest plus the present value of the interest to maturity calculated with a discount rate of Treasuries plus 50 bps.
Conversions will be settled in common stock. The initial conversion rate is 100.2305 shares per each $1,000 of notes, or $9.98 per share.
Proceeds will be used to repurchase from time to time a portion of the company’s 5.375% convertible senior notes due 2017 and its 5.75% convertible senior notes due 2018.
Prospect Capital is a New York-based business development company.
| Issuer: | Prospect Capital Corp.
|
| Securities: | Convertible senior notes
|
| Amount: | $225 million
|
| Maturity: | July 15, 2022
|
| Bookrunner: | Goldman Sachs & Co.
|
| Coupon: | 4.95%
|
| Price: | 98
|
| Par: | $1,000
|
| Yield: | 5.39%
|
| Conversion premium: | 10%
|
| Conversion price: | $9.98
|
| Conversion rate: | 100.2305 shares
|
| Call options: | On or after April 15, 2022 at par plus accrued interest and the present value of the interest to maturity calculated with a discount rate of Treasuries plus 50 bps
|
| Pricing date: | April 6
|
| Settlement date: | April 11
|
| Talk: | 4.95% coupon, up 10%; reoffer price 98-98.5 for effective yield of 5.39%-5.28%
|
| Stock symbol: | Nasdaq: PSEC
|
| Reference price: | $9.07
|
| Market capitalization: | $3.25 billion
|
| Cusip: | 74348TAR3
|
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