Home Alts News Franklin Square’s Non-Traded BDCs Committed Loans of $397 Million

Franklin Square’s Non-Traded BDCs Committed Loans of $397 Million

Franklin Square Capital Partners (Franklin Square) completed $397 million worth of investments in the form of originated loans through two of its non-traded BDCs during the month of November.

FS Investment Corporation II (FSIC II) and FS Investment Corporation III (FSIC III) are both non-traded BDCs sponsored by Franklin Square that focus mainly on investing in the debt securities of private U.S. middle-market companies.

One of the funds’ largest investments was a $204 million senior secured combined commitment to BenefitMall.

Headquartered in Dallas, Texas, BenefitMall provides employee benefit, payroll, human resource and employer services for small and medium-sized businesses. It is a portfolio company of Austin Ventures and HarbourVest Partners.

Another large investment was a $160 million senior secured combined commitment to Winchester Electronics, a provider of engineered electrical connectors and cable assemblies, and a portfolio company of Audax Group.

“We specialize in providing customized financing solutions to leading, private U.S. companies like these, which are backed by strong private equity sponsors,” commented Michael C. Forman, Chairman and Chief Executive Officer of FSIC II and FSIC III. “In addition, our investment in Winchester was structured and funded in conjunction with NewStar Financial and serves to highlight one of the benefits of our recently announced strategic relationship,” he added.

Franklin Square announced its connection to NewStar Financial last month when it committed $300 million to purchase 10-year subordinated notes plus warrants that were issued by the specialized commercial finance company. NewStar offers a variety of financing options for working capital and growth strategies, to fund acquisitions, to recapitalize, and to purchase equipment. Franklin Square’s investment should aid NewStar’s expansion.

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