BlackRock Capital Investment Corp. announced the pricing of $125 million in aggregate principal amount of senior unsecured 5.00% convertible notes due 2022.
The underwriters have a 30-day option to buy up to about $18.8 million of additional notes to cover overallotments, if any.
The offering is expected to close June 13.
The notes will be convertible at an initial conversion rate of 118.2173 BlackRock Capital Investment common shares per $1,000 principal amount of notes, which is equivalent to an initial conversion price of approximately $8.46 per common share. The initial conversion price represents a 10.0% conversion premium over the last reported sale price of the company's common shares June 7, which was $7.69 per share.
Before Dec. 15, 2021, the notes will be convertible only on certain circumstances and during certain periods, and after such period, it will be convertible at any time prior to the close of business on the scheduled trading day immediately preceding the maturity of the notes. Upon conversion, holders will receive cash, BlackRock Capital Investment common shares or a combination of cash and common shares at the company's election.
The notes, which will mature June 15, 2022, will be general unsecured obligations of the company. Interest on the notes will be payable semiannually in arrears on June 15 and Dec. 15 of each year, starting Dec. 15.
The net proceeds of the offering may be used to repay certain outstanding indebtedness, including repaying outstanding borrowings under the company's credit facility. The proceeds may also be used for other general corporate purposes, including investing in portfolio companies.
Morgan Stanley & Co. LLC, Bank of America Merrill Lynch, BMO Capital Markets, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities and HSBC Securities (USA) Inc. are acting as joint book-running managers for the offering.