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Sierra Income to acquire Medley Capital, Medley Management

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Sierra Income to acquire Medley Capital, Medley Management

Sierra Income Corp., Medley Capital Corp. and Medley Management Inc. entered into definitive agreements for Sierra Income to acquire Medley Capital and Medley Management.

Under the terms of the deal, Medley Capital will merge with and into Sierra Income, with Sierra Income as the surviving company. Simultaneously, Sierra Income will acquire Medley Management, and Medley Management's existing asset management business will operate as a wholly owned subsidiary of Sierra Income.

The boards of Sierra Income, Medley Capital and Medley Management unanimously approved the deal.

The combined institution will have over $5 billion of assets under management, including $2 billion of internally managed assets.

Upon completion of the deal, Sierra Income's board will consist of its current independent directors, one interested director from Sierra Income and two independent directors from Medley Capital.

For each share of Medley Capital common stock, Medley Capital shareholders will receive 0.8050 share of Sierra Income common stock.

For each Medley Management class A share, Medley Management class A shareholders will receive 0.3836 share of Sierra Income common stock, $3.44 per share of cash consideration and a special cash dividend of 65 cents per share.

Unit holders of Medley LLC, a unit of Medley Management, will have their units converted to Medley Management class A common stock and will receive 0.3836 share of Sierra Income common stock for each class A share of Medley Management held, plus $3.44 per share of cash consideration and a special cash dividend of 35 cents per share.

Upon completion of the deal, current Sierra Income shareholders will continue to own common shares of Sierra Income.

Additionally, upon deal closing, Sierra Income common stock will be listed on the New York Stock Exchange and Sierra Income will remain a business development company.

The deal is expected to close in the fourth quarter of 2018 or early in 2019.

Broadhaven Capital Partners LLC served as financial adviser for the special committee of Sierra Income's board while Sullivan & Worcester LLP served as its legal counsel. For the special committee of Medley Capital's board, Sandler O'Neill & Partners LP served as financial adviser while Kramer Levin Naftalis & Frankel LLP was its legal counsel. Barclays Capital Inc. served as financial adviser while Potter Anderson & Corroon LLP served as legal counsel to the special committee of Medley Management's board. Goldman Sachs & Co. LLC and Eversheds Sutherland (US) LLP served as financial adviser and legal counsel to Medley Management, respectively.