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MSC Income Fund Increases Quarterly Dividend and Announces Share Repurchase Offer

The board of MSC Income Fund, a non-traded business development company previously known as HMS Income Fund, has increased the quarterly cash dividend.

The board of MSC Income Fund, a non-traded business development company formerly known as HMS Income Fund, has declared a quarterly cash dividend of $0.165 per share, a 10 percent increase from the previous dividend paid in February 2022.

This dividend will be paid on May 2, 2022 to stockholders of record as of March 31, 2022.

The company said that this marks the third increase in the quarterly dividend rate since MSC Adviser I LLC became the sole adviser and reinstated the quarterly dividend in the first quarter of 2021.

The company was previously advised by a Hines affiliate and sub-advised by an affiliate of Main Street Capital Corporation (NYSE: MAIN). In October 2020, shareholders approved a new advisory agreement where Main Street would become the sole adviser.

“Additionally, the board approved the company making a repurchase offer for 90 percent of the amount of proceeds resulting from shares issued in lieu of cash distributions from the May 2, 2022 dividend payment to participants in the company’s distribution reinvestment plan,” the company said in a filing with the Securities and Exchange Commission.

The final tax treatment for 2022 dividends is currently expected to include a combination of ordinary taxable income and qualified dividends and may include capital gains and return of capital.

The company has adopted an “opt in” dividend reinvestment plan for its stockholders, therefor, stockholders will receive dividends in cash unless they have specifically “opted in” to the dividend reinvestment plan.

MSC Income Fund is a specialty finance company that primarily provides customized debt capital to middle market companies and long-term debt and equity capital to lower middle market companies.

The company’s initial offering ran from June 2012 until December 2015 and its follow-on offering closed in September 2017. Through December 31, 2021, the company raised approximately $863 million, including proceeds from the distribution reinvestment plan of approximately $129.5 million. As of the fourth quarter of 2021, the BDC’s investment portfolio was valued at $1.08 billion.

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