Prospect Capital Corporation (NASDAQ: PSEC), a publicly traded business development company, reported that its continuous preferred stock offering has raised $60.9 million in aggregate principal amount since the initial closing in the quarter ending December 31, 2020.
The offering is comprised of up to 40 million shares of Series A1, M1, and M2 with a $1 billion aggregate liquidation preference. The preferred stock has a stated annual dividend rate of 5.5 percent, paid monthly, and ranks senior to Prospect’s common stock.
Preferred Capital Securities LLC, a broker dealer and wholesale distributor, serves as the dealer manager for the offering.
The preferred stock is perpetual and convertible into Prospect Capital’s publicly traded common stock at the investor’s discretion, with conversions occurring twice monthly, subject to certain conditions and fees that decline to zero over time.
“We have experienced strong investor demand in the market for this preferred stock investment providing capital protection, valuation stability, steady cash contractual income, and uncapped liquidity,” said Grier Eliasek, president and chief operating officer of Prospect Capital Corporation. “We are pleased with the early success of our $1 billion preferred stock offering from a wide range of individual and institutional investors.”
Formed in 2013, Preferred Capital Securities is a boutique managing broker-dealer that distributes investment products through broker-dealers and registered investment advisors.