Maryland based private equity firm and global asset manager
American Capital, Ltd.
) announced the closure of a senior secured revolving credit
facility worth $750 million. The facility, which has been provided
Bank of America Corp.
), is set to mature in June 2016 and carries interest of LIBOR plus
Management stated that the new revolving credit facility enhances
the company's financial flexibility to invest in senior secured
floating rate loans. This may also boost net operating income, if
Notably, during first-quarter 2014, American Capital recorded $442
million of cash proceeds from the realization of portfolio
investments and made new investments worth $321 million including
senior floating rate loans of $199 million.
As of Mar 31, 2014, American Capital's total debt was $790 million
while cash and cash equivalents stood at $468 million.
We believe the company will proceed with strong investment
opportunities this year as it is expected to utilize capital for
investing in new companies and at the same time provide additional
finance to the existing ones.
American Capital currently carries a Zacks Rank #3 (Hold). Some
better ranked stocks in this space include
Fifth Street Senior Floating Rate Corp.
Saratoga Investment Corp.
). Both the stocks sport a Zacks Rank #1 (Strong Buy).
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