As expected, the two FS KKR public BDC funds are planning to merge. However, there’s an unexpected change in compensation that will leaves shareholders of the super-sized BDC much poorer.
Over the weekend a major portfolio company of FS KKR Capital and recently public FS KKR Capital II filed for bankruptcy. Both sister BDCs have substantial exposure.
BDC sector prices offer mixed messages even as the S&P ekes out a win. We also discuss a disconcerting increase in bankruptcies and the newest public BDC.
The biggest BDC-financed company bankruptcy of the year – and the 8th this month – happened on June 18. We re-publish a full report from the BDC Credit Reporter, but first discuss how so many BDC lenders have been caught out lending into the flawed energy model. Corrected June 22, 2020: An earlier version of this article included Main Street and HMS Income incorrectly as lenders to the bankrupt company.
The BDC Reporter welcomes the most recent addition to the public BDC sector : FS KKR Capital II. We discuss how the BDC just switched from non-listed to listed and review the history; balance sheet; dividend and credit quality of the new player. We also place this expansion of the size of the public BDC sector in a broader context and ask some hard questions.
“What goes up will come down” as BDC sector prices proved this week as volatility resumed. Also there were other notable developments including equity capital raised; a surprise dividend and important shareholder approvals. We also discuss the surprising change the size of the BDC sector is likely to take in the days and months ahead.
The BDC Reporter republishes and comments about a portfolio company of FS-KKR Capital that has just been downgraded by S&P.
We re-publish an article from the BDC Credit Reporter about a portfolio company of FS KKR Capital that is in the process of literally selling off its assets. We review the impact on the BDC.
We re-publish an article from the BDC Credit Reporter about an under-performing portfolio company of FS-KKR Capital and three of its non-listed sister BDCs.
We republish an article from the BDC Credit Reporter about a troubled health care company that six BDCs have first and second lien debt exposure to and explain our broader concerns about the outlook for health care related credits.
We re-publish a post from the BDC Credit Reporter regarding the latest bankruptcy filing of a BDC-financed company, and review the implications for the public and non-listed BDC lenders involved.
In a week where BDC stocks moved up to break new 2019 records – which we discuss at length – the BDC Reporter looks down the road at the growing and changing nature of the sector.