American Capital Senior Floating Ltd.'s board has decided to liquidate and dissolve the company after conducting a strategic review.
The liquidation and dissolution plan includes the sale of its assets and the distribution of the net proceeds to the company's stockholders.
The company's board intends to call a special meeting of stockholders to seek their approval of the liquidation.
"As we have discussed with stockholders, the company lacks scale and has limited opportunities for growth in earnings due to challenging conditions in the liquid credit market," President and CEO Kevin Braddish said. "[It] also suffers from an inability to accretively raise additional equity capital to grow due to the stock trading at a significant discount to its net asset value."
American Capital Senior Floating estimates that distributions received by each stockholder, including cumulative dividends declared and payable after March 31, will be between 97% and 99% of its March 31 net asset value per share of $13.11, after adjusting for expected expenses.
For the quarter ended March 31, the company had net investment income per share of 22 cents, compared to 25 cents in the prior quarter. Its net earnings grew sequentially to 31 cents per share from 25 cents per share due to higher net realized and unrealized gains on investments.