New Mountain raising fresh capital

The New York-based BDC is offering five million new shares of its common stock at $14.14 per share. Chairman Steven Klinsky is purchasing 500,000 of the new shares.  

New York-based New Mountain Finance Corporation (NMFC) has priced an underwritten offering of 5,000,000 shares of its common stock at a public offering price of $14.14 per share. Steven Klinsky, the chairman of the company's board of directors, is purchasing 500,000 shares in this offering at the public price.

The offer is expected to close on 25 September. In connection with the offering, the BDC is giving the underwriters an option to purchase up to 750,000 shares of the company's common stock, New Mountain said in a statement.

The joint-lead book-running managers for the offering are Wells Fargo Securities, Goldman Sachs, Morgan Stanley and Keefe, Bruyette & Woods. The lead manager for the offering is Robert W. Baird & Co. The co-managers are Janney Montgomery Scott and Oppenheimer & Co.

The BDC will use the net proceeds – which if fully subscribed will raise more than $70 million – to primarily make new loans to portfolio companies. New Mountain may also use a portion of the money for other general corporate purposes, paying down debt and general working capital.

BDCs have lately been limited in terms of new equity offerings, as many have been trading below book value. New Mountain has been trading at a slight premium to book value. Its price to net asset value stood at 1.06x as of last Friday (18 September). The BDC's stock was trading at $14.19 per share on the New York Stock Exchange at the close of business yesterday (22 September).

New Mountain Finance Corporation is an externally managed investment company regulated as a BDC. The company makes loans across the capital structure, including first and second lien debt, notes, bonds and mezzanine securities. In some cases, it takes small equity stakes in borrowers. The company's investment activities are managed by its investment adviser, New Mountain Finance Advisers BDC. The vehicle had about $1.4 billion in assets as of the end of the second quarter.