Stira Alcentra Global Credit Fund, a closed-end fund formerly known as Steadfast Alcentra Global Credit Fund, has scheduled its special meeting where shareholders will vote on the proposed merger with Priority Income Fund Inc., a closed-end fund that would be the surviving entity of the merger.
The special meeting will be held on May 6, 2019 at 9:00 a.m. (Pacific Time) at Stira Alcentra Global Credit Fund’s corporate headquarters at 18100 Von Karman Avenue, Suite 500 in Irvine, California.
The boards of both funds have approved the proposed merger, which is expected to close during the second quarter of 2019 with the approval of Stira Alcentra fund shareholders and other customary closing conditions. The approval of Priority’s shareholders is not required.
The proposed merger is a “NAV for NAV” transaction, under which Stira Alcentra shareholders would receive the number of shares of Priority common stock determined by applying an exchange ratio that compares the respective net asset values of the funds shortly before closing.
Priority’s existing common stock offering, unrelated to the proposed merger, is expected to continue uninterrupted.
The Stira Alcentra Global Credit Fund launched in May 2017 and raised approximately $36.2 million in investor equity. In September 2018, the board suspended the fund’s $3 billion initial public offering and distribution reinvestment plan due to market conditions not being conducive to continuing the offering.
Since that time, the board has been evaluating various strategic alternatives for the company. The fund is advised by a Steadfast affiliate and sub-advised by Alcentra NY LLC, a BNY Mellon investment boutique.
Priority Income Fund was created to acquire an investment portfolio of senior secured loans or pools of senior secured loans known as collateralized loan obligations. Priority commenced operations in January 2014 and had approximately $336 million of net assets as of September 30, 2018.
Priority is managed by Priority Senior Secured Income Management LLC, which is led by investment professionals from the investment and operations team of Prospect Capital Management L.P.
Prospect has approximately $6.6 billion of assets under management as of December 31, 2018.
Stira Alcentra Global Credit Fund’s investment adviser is Stira Investment Adviser, LLC, an affiliate of the Steadfast Companies, a group of integrated real estate investment, management and development companies. The Steadfast Companies own or manage more than $5.6 billion in assets, and since their founding in 1994 have sponsored more than 50 privately or publicly offered prior real estate investment programs.