BDC News In Review: Week Ended June 27, 2025
Premium FreeEXECUTIVE SUMMARY
This briefing summarizes – in chronological order – significant developments during the week ended June 27, 2025 within the Business Development Company (BDC) market, as reflected in the pages of the BDC Reporter, BDC Credit Reporter and BDC Best Ideas.
By the way, you’ll notice there is no podcast this week. This new feature – which we introduced only last week – is being discontinued for the moment. The technology proved not to be as reliable as we had hoped, with the two AI-generated talking heads involved going off on tangents that did not reflect our views, or the facts as given. Never mind, we’ll try again with another tool shortly.
As to the news below, far and away the most important story – but also the most predictable one which the market has already absorbed – is the approval by Portman Ridge (PTMN) shareholders of its intended merger with Logan Ridge Finance (LRFC). This announcement – following the latest vote – was but a formality. We shall shortly lose a public BDC, and see another renamed. That brings our coverage universe down to 45 BDCs.
However, there is no rest for the weary as next week we’ll be adding the latest BDC to go public to our list and update our Subscriber Tools. The BDC in question is Blue Owl Technology Finance, ticker OTF, which had its IPO a fortnight ago. With this addition, there will be 6 public BDCs operating in the venture-debt segment of the market.
KEY DEVELOPMENTS
6/23/2025: BDC Reporter: Palmer Square Capital BDC Announces Second Quarter 2025 Supplemental Dividend of $0.06
BDC Reporter Adds: A little surprisingly PSBD will pay out $0.42 for the IIQ 2025, above the $0.39 paid in the IQ ($0.36 = $0.03). That’s a higher payout than the analyst consensus of $0.40 for the quarter. Over at our sister publication – BDC Best Ideas – we are now projecting a full year payout of $1.63 a share, but it’s only an educated guess because of the way PSBD sets its payout. First PSBD announces a regular dividend for the quarter ahead – $0.36 right now – and then when approaching the end of the quarter out of the difference between expected earnings and $0.36 most – but not all – is paid in a supplement (like the one announced here). However, exactly what percentage of earnings is retained is up to the manager, leaving Best Ideas and the rest of us to guess. As to spillover income, there is very little to speak of – and management does not provide a number – because of their plans to pay “nearly all earnings during the fiscal year” – as per the latest CC.
BDC Reporter Adds: Not surprisingly, TRIN is lending to an AI focused company. Is there any other kind right now?
6/24/2025: BDC Credit Reporter Premium Article : Continental Battery Co: Placed On Non-Accrual
Intro: A leading distributor of batteries is getting into ever deeper trouble and is now non-performing. Four BDCs are involved at the top of the company’s capital structure but losses could still be material.
6/24/2025: BDC Best Ideas: New Features
Intro: If one’s going to choose the best BDCs to invest in, the underlying data on which decisions are made has to be accurate and up to date. We believe the ERT – and our new annotated News feed – are an invaluable resource, both for us and our readers.
6/25/2025: BDC Reporter: Prospect Capital CEO John F. Barry Purchases 623,300 Shares of Stock
BDC Reporter Adds: According to MarketBeat, PSEC CEO John F. Barry bought 623,300 shares of the firm’s stock in a transaction dated Friday, June 20th. The shares were acquired at an average price of $3.19 per share, with a total value of $1,988,327.00. Following the purchase, the chief executive officer now directly owns 83,266,026 shares of the company’s stock – nearly 20% of all shares outstanding – valued at approximately $265,618,622.94. Mr Barry continues to double down on PSEC’s stock even as ever new all-time lows are reached. With $240mn of compensation going to the external manager every year – the bulk of which filters down to Mr Barry after costs are paid – he has the wherewithal to continue to buy up the shares regardless. Lest we forget, PSEC has the most onerous – shareholder unfriendly fee arrangements in the BDC industry. If PSEC charged 1.0% of assets as some other BDCs do, and had a “total return” incentive fee arrangement, shareholders would be about $160mn a year better off and Mr Barry that much poorer, based on my down and dirty calculations. Net Investment Income would be nearly 40% higher. A reminder that how the BDC earnings cake gets divided up matters…
6/26/2025: BDC Credit Reporter Premium Article: Wellpath Holdings: Exits Bankruptcy
Intro: After a series of complex maneuvers a healthcare company involved in the prison system has emerged from bankruptcy. The 3 BDCs involved may – on paper – have escaped immediate injury but this is far from over.
6/27/2025: BDC Reporter Premium Article: Trinity Capital: Prices New Unsecured Debt
Intro: Trinity Capital )TRIN) is tapping the institutional market for fixed income debt. We assess the bottom line impact on the BDC and what this means for the fixed income market more generally.
BDC Reporter Adds: Anti-climatically and after a couple of attempts Portman Ridge Finance (PTMN) has gained the approval of its merger with Logan Ridge Finance (LRFC), whose own shareholders gave their nod earlier. Now PTMN will absorb all those extra assets and issue new shares in about two weeks. And immediately change its name and ticker – an unusual move for an existing BDC just after a merger. We’ll have more to say when this all happens and in the months ahead. PTMN/BCIC has not had the greatest track record. Let’s see if they can do more than change what they are called and materially improve their financial performance….
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