Author: Nicholas Marshi

A brief update on a major development in the ongoing struggle over TICC Capital (TICC). A judge in Connecticut has ruled against NexPoint and demanded more disclosures from the current Board and postponed the Special Shareholder Meeting scheduled for October 27th. This is getting wild, but the stakes are high for both investors and contenders, albeit in different ways.

WhiteHorse Finance (WHF) announces an equity Rights Offering with a short fuse. This raises questions in our minds as to what the Company’s goals are and whether this will serve as a precedent for other BDCs starved for new capital for many months now. We also disclose our investment group’s short position in the stock and long in the public Notes.

We complete the BDC Reporter’s review of all three contenders for TICC Capital (TICC) with an in-depth look at NexPoint Advisors bid. This subsidiary of Highland Capital has a different approach than Benefit Street Partners and TPG Specialty (TSLX). But is different better ?

The seemingly endless struggle over TICC Capital (TICC) continues, with 2 of the contenders-TICC-Benefit Street Partners & TPG Specialty (TSLX) making dramatic arguments about what will happen to shareholders distributions going forward. We seek to sort fact from fiction, and end with a sobering perspective for TICC shareholders that is also relevant to most BDC investors.

The BDC Reporter offers up an in-depth review of TPG Specialty Lending’s (TSLX) offer to acquire TICC Capital’s (TICC) stock. We’ve previously looked at the proposal by Benefit Street Partners to become TICC’s External Manager. TSLX just wants to buy TICC outright. We review the would-be buyer’s key arguments with a jaundiced eye.

Just after we wrote an evaluation of the TICC-BSP proposal to manage TICC Capital last Friday, the Company issued a new presentation on Monday to shareholders. TICC repeated many points made previously, but also added several new comments which we could not help but bring to our readers attention, and which leave us more confused than ever.

The BDC Reporter will be reviewing each of the three outstanding proposals to manage TICC Capital (albeit with a new name and ticker) from Benefit Street Partners, TPG Specialty and NexPoint Advisors. We begin with the current Board’s favorite: Benefit Street Partners, go deep into the Proxy and come to some disturbing conclusions.

On Monday, the BDC Sector dropped sharply in price across the board and some key indices reached new record lows, as the 2 year drawdown continues. We detail the nature and extent of the carnage and seek to learn lessons therefrom. We offer up some hope of a turn around in the short term. Longer term, we still have our doubts… Sorry.

Now the would External Managers and/or owners of TICC Capital have made their initial bids for the Company, the time has arrived for mutual mud slinging. We review the latest developments, but come away still undecided, despite the debate underway by dint of press releases.

Just when we thought the battle for TICC Capital (TICC) was over, two huge developments have put the Company back in play and sent its stock price up 10%. We dissect and discuss the latest developments, and seek to handicap the battle between these asset management heavyweights. Whether TICC shareholders will fully benefit is an open question.

The opaque struggle for control of the right to be the External Manager of TICC Capital (TICC) continues. We discuss the latest offer and counter-offer; wring our hands for the Company’s shareholders and make a stab at predicting how this will turn out. Spoiler Alert: the shareholder does not fare well at the end.

The BDC Reporter disagrees with a Barron’s article pointing to short term Return On Equity as an indicator of which BDCs might be worth investing in. We illustrate our point by using the case in point of Gladstone Capital (GLAD) and suggest a better way to analyze who to buy or stay away from.

We provide some color about the direction of BDC stock prices on a turbulent day, and discuss two stories of interest: Fifth Street Finance’s change of heart about stock repurchases and Oxford Lane’s disclosure that Taxable Income might be hurt by higher 3 Month LIBOR.Written in a hurry after the market closed.

NexPoint, a subsidiary of Highland Capital, launches an unsolicited offer to become TICC Capital’s (TICC) new External Manager instead of Benefit Street Partners. Neither contender is telling investors what they need to know, but we’re hoping the tussle may shed some light on this strange changing of the guard at TICC.

On the day before Pennant Park Floating Rate Capital (PFLT) swallows up MCGC Capital (MCGC) forever, its price is at a two year low. We call Buying Opportunity for potential PFLT investors just before the conservatively managed BDC gets set to nearly double in size.

We take on the subject of BDC stock buybacks, touted in Barron’s recently. We review the wide discrepancy between BDC managers enthusiasm for stock repurchases and reality. We end by diagnosing why the BDC sector needs a more viable and longer term solution than buybacks to its current depressed state. Plus, how we are positioned.

With half the Business Development Companies having reported earnings for the second quarter, we have a look at the direction of the sector and highlight a number of developments underway. It’s just a snapshot and not a comprehensive review. We’ll have a full survey once earnings season is over.

Hot off the digital presses details on TICC Capital Management’s proposed sale of the management contract in TICC Capital (TICC) to Benefit Street Partners, an arm of a huge Private Equity Group. The new external manager-if approved by shareholders-will be changing everything about the Company and the existing managers will be long gone.

We provide an update on the status of the BDC sector rally that began last week, as the new month/week begins.