MVC Makes $40MM Investment in Debt Instruments
MVC Capital invested approximately $40 million in four collateralized senior subordinated loans with a weighted average interest rate of 15.1%.
The four loans were originated by MVC’s experienced mezzanine finance team through its relationships with financial institutions. These new loans were restructured in partnership with the senior lender and the four companies in order to keep the companies’ total leverage the same and allow MVC to participate within the existing collateral structure. The borrowers operate in various sectors, including the transportation, health care, and software industries. MVC financed the transaction through available cash and borrowings from the new Firstrust Bank credit facility.
“MVC is positioned to be a preferred partner for financial institutions as they seek to preserve and grow client relationships in a changing regulatory environment,” said Michael Tokarz, chairman & portfolio manager of MVC Capital. “Having recently established an experienced team focused on the mezzanine lending space, led by veteran bankers David Williams and Harrison Mullin, we are confident in our ability to provide shareholders with meaningful returns on yielding investments in a challenging interest rate environment.”
Mullin added, “With an established presence in the Midwest, a robust pipeline and long-term relationships with national and regional banks and lenders, MVC has the ability to identify and quickly respond to investment opportunities. We believe the quality of the loans, their yields and the collateral in these particular portfolio companies reflect our ability to achieve attractive relative returns for MVC. We look forward to continuing to leverage our relationships with key financial institutions to assist them in advancing their strategic objectives and drive the expansion of MVC’s yielding portfolio.”