AR Capital’s BDCA II Terminates IPO

The board of directors of Business Development Corporation of America II, a publicly registered non-traded business development company sponsored by AR Capital, terminated the continuous initial public offering of the company’s stock, according to a filing with the Securities and Exchange Commission. The board has authorized the deregistration of all shares of common stock which remain unsold. In connection with the termination, the board intends to dissolve and liquidate the company.

Regarding the termination, the company cited “current regulatory and market conditions affecting the direct investment industry, particularly the unclear impact of the Department of Labor proposed rule regarding fiduciary duty.”

The board determined that it is in the best interests of the company to file a notice with the SEC to withdraw its prior election to be governed as a business development company. The board recommended that the company’s stockholders approve this course of action, which will be submitted to the company’s stockholders under a proxy statement.

The board suspended the monthly distributions effective December 31st, and the final payment of distributions occurred on December 1st. The company also suspended the distribution reinvestment plan, effective December 31st.

Last month, AR Capital, the company’s sponsor, said that it will stop offering and selling new investment products at the end of the year. The decision came after multiple scandals involving AR Capital-affiliated companies were revealed and broker-dealers throughout the country, including those controlled by AR Capital, had suspended or cancelled selling agreements for the company’s offerings.