Fifth Street gets $176 million revolver due 2019 at Libor plus 200 bps

By Angela McDaniels

Tacoma, Wash., Nov. 4 – Fifth Street Holdings LP entered into a credit agreement for a new $176 million five-year revolving credit facility on Tuesday, according to an 8-K filing made with the Securities and Exchange Commission by Fifth Street Asset Management Inc.

The initial interest rate is Libor plus 200 basis points, and the initial commitment fee is 30 bps.

The margin over Libor ranges from 200 bps to 300 bps, and the commitment fee ranges from 30 bps to 45 bps. Both are based on the company’s total leverage ratio.

The revolver has a $100 million accordion feature.

Morgan Stanley Senior Funding, Inc. and Sumitomo Mitsui Banking Corp. are the lead arrangers and bookrunners. Morgan Stanley Senior Funding is the syndication agent. Sumitomo Mitsui Banking is the administrative agent.

Under the revolver’s financial covenants, the company must not let its assets under management be less than the sum of $3.25 billion plus 50% of all new management fee assets, it must not allow its leverage ratio to be greater than 3 to 1, and it must maintain a minimum interest coverage ratio of 5 to 1.

Fifth Street Asset Management is an alternative asset manager based in Greenwich, Conn. It conducts all of its operations through Fifth Street Management LLC and FSCO GP LLC, subsidiaries of Fifth Street Holdings.

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