FS Investment Corporation (FSIC) IV, a new business development company (BDC) sponsored by Franklin Square Capital Partners, has begun operations after gaining approval from the Securities and Exchange Commission (SEC).
The new vehicle is offering up to 250 million shares of common stock.
FSIC IV launched with about $9.1 million in capital, which included commitments from Franklin Square and FSIC IV’s investment sub-adviser, GSO Capital Partners. PDI reported in September that Franklin Square had registered the fourth vehicle with the SEC, aiming to raise about $2.65 billion shares at $10.60 per share.
The fourth BDC in a series from Franklin Square is a publicly registered, non-traded BDC primarily focused the senior secured debt of private mid-market US companies. It is one of the first BDCs to launch with a commission structure that is responsive to the FINRA Regulatory Notice 15-02, which lowers upfront and all-in distribution fees, the firm said in a statement.
The first FSIC vehicle, Franklin Square’s inaugural fund and the industry’s first non-traded BDC, listed its shares on the New York Stock Exchange (NYSE) in April 2014. As a successor fund, FSIC IV plans to provide financing options to US mid-market companies through GSO’s direct lending origination platform.
Philadelphia-based Franklin Square and New York-based GSO are planning to roll FSIC II into the public vehicle soon and is set to do the same with the rest of the BDCs, once they gain enough traction. The public vehicle has about $4.1 billion in assets. FSIC II holds about $3.3 billion and is closed to new investors.
The firms also manage the non-traded Franklin Square Energy & Power (FSEP) BDC. Its assets are at $4 billion. In total, the BDCs have about $15.7 billion under management.