FS Global Credit Opportunities Fund, a closed-end fund operated by FS Investments with $2.4 billion total assets under management, plans to list its common stock on the New York Stock Exchange before the end of the third quarter of 2022.
Prior to the listing, the fund will be renamed FS Credit Opportunities Corp. and is expected to trade under the ticker symbol “FSCO.”
“We are excited to announce this important milestone and to begin preparations to list [FS Global Credit Opportunities Fund] and deliver liquidity to shareholders later this year…,” said Michael Forman, chairman and chief executive officer of FS Investments. “We believe the fund will be highly differentiated in the public markets by its scale, attractive dividend yield, strong recent track record, outperformance relative to broader credit indexes, and the investment team’s access to the full resources and infrastructure of FS Investments.”
With shareholder approval, upon listing, the fund’s management fee will drop from 1.5 percent to 1.35 percent, and the hurdle rate for calculation of the incentive fee will be based on percentage of net assets rather than adjusted capital, consistent with other publicly traded closed-end funds. The company said that the reduction in management fee is expected to enhance the fund’s net investment income and allow it to sustain an annualized distribution yield of 7.25 percent.
The board also approved the fund’s conversion from a Delaware statutory trust into a Maryland Corporation and elected to suspend the quarterly share repurchase program effective March 31, 2022.
FS Global Credit Opportunities Fund plans to launch a quarterly tender offer before the suspension date and does not intend to launch another tender offer after March 31st. After listing on the NYSE, the fund plans to implement an open-market share repurchase program.
FS Global Credit Opportunities Fund invests in non-traditional credit opportunities including event-driven credit, special situations and private capital structure.
FS Investments is an asset manager headquartered in Philadelphia with offices in New York City, Orlando, and Leawood, Kansas.
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