KCAP could use note proceeds to invest in term loans, mezzanine debt

By Angela McDaniels

Tacoma, Wash., Oct. 4 - KCAP Financial, Inc. priced $36 million of notes on Thursday and will use the proceeds to invest in portfolio companies and collateralized loan obligation funds in accordance with its investment objective and strategies, according to a company news release.

KCAP Financial is a New York-based business development company that originates, structures and invests in senior secured term loans, mezzanine investments and selected equity securities in middle market companies.

The $25-par senior notes have a 7 3/8% coupon and mature on Sept. 30, 2019. They are callable beginning Sept. 30, 2015.

The underwriters have a $5.4 million over-allotment option.

Stifel, Nicolaus & Co., Inc. and Barclays are the bookrunners. Janney Montgomery Scott LLC and JMP Securities LLC are the co-lead managers. Ladenburg Thalmann & Co. Inc., Sandler O'Neill & Partners, LP and Wunderlich Securities, Inc. are the co-managers.

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