Fifth Street Management has raised $100 million through an initial public offering for its new business development corporation Fifth Street Senior Floating Rate Corporation, the firm announced in a statement Thursday.
The new BDC will invest in senior second loans, including first lien, unitranche and second lien instruments, according to the statement. As its name suggests, the BDC will only invest in floating rate instruments for mid-market companies with sub-investment grade debt, according to the statement.
The firm offered 6,666,668 shares of the BDC at $15 per share on the Nasdaq Stock Exchange, according to the release. Underwriters have the option of purchasing up to 1 million additional shares of common stock.
Morgan Stanley, Deutsche Bank Securities, UBS Investment Bank and Barclays acted as lead bookrunners for the offering. Maxim Group, JMP Securities, Ladenburg Thalmann, Wunderlich Securities and National Securities Corporation were co-managers of the offering, according to a statement.
Fifth Street declined to comment beyond its release.
The firm already operates another BDC known as Fifth Street Finance, which lends to and invests in small and mid-market companies in connection with private equity sponsors, according to its website.