Franklin Square files for new private BDC

Franklin Square Capital Management has filed with the Securities and Exchange Commission to register its offering of 250 million shares at $10.60 per share. The FSIC IV vehicle has a proposed maximum aggregate offering of $2.65 billion. FSIC is advised by Philadelphia-based Franklin Square, which handles administration and capital raising for the public and private vehicles, while Blackstone-owned GSO Capital Partners sub-advises the BDCs and handles loan origination.

FSIC’s management has said on previous earnings calls that the firm plans to roll out its fourth private BDC soon. Brad Marshall, senior managing director at GSO, who oversees the vehicles’ investments, told PDI he expects the fourth vehicle to be up and running in November.

The publicly-traded FSIC I vehicle has about $4.4 billion in assets. It was listed on the New York Stock Exchange in April 2014. Franklin Square and GSO already co-manage two other private BDCs: FSIC II and FSIC III. The firm’s strategy has been to grow the vehicles to a few billion, close them to new money and eventually roll them into the publicly-listed FSIC. The firm plans to roll FSIC II into the publicly-traded FSIC soon.

FSIC II was launched in June 2012 and has $5.1 billion in assets under management across 183 portfolio companies. The vehicle is currently closed to new money. FSIC III was rolled out in April 2014 and now has $1.9 billion in assets across 119 portfolio companies. The third BDC is still open to new money.

GSO usually draws capital for its deals from across the three BDCs as well as occasionally tapping the broader GSO platform.