Three business development companies (BDCs) managed by Franklin Square Capital Partners (FSCP) recently provided financing to Dent Wizard International Corp. (Dent Wizard), a vehicle reconditioning servicer in Canada and the U.S. The BDCs provided a unitranche term loan to finance a dividend recapitalization of Dent Wizard.
Considered a hybrid loan, unitranche financing combines senior debt and subordinated debt into one amount with a blended interest rate.
FS Investment Corporation, a publicly traded BDC, FS Investment Corporation II and FS Investment Corporation III, both non-traded BDCs, provided the financing.
H.I.G. Capital, a global private equity investment firm that manages $17 billion, is also an investor in Dent Wizard.
“We are pleased to have the opportunity to make this commitment to Dent Wizard and to work again with H.I.G. on this new direct origination,” said Michael C. Forman, Chairman and Chief Executive Officer of FSIC, FSIC II and FSIC III. “The scale of our platform gives us the ability to provide customized financing solutions to our clients and to support our portfolio companies as they develop and grow their businesses.”
FSCP’s non-traded BDCs are sub-advised by an affiliate of GSO Capital Partners (GSO), which is the credit platform of Blackstone, a global investment and advisory firm. The unitranche financing marks the second transaction between the BDCs and Dent Wizard.
“Since the initial financing in April 2013, Dent Wizard has grown its market share, deleveraged its balance sheet and demonstrated a consistent ability to generate free cash flow,” commented Brad Marshall, Senior Managing Director at GSO. “We believe Dent Wizard’s leading management team and diverse line of products has the company well-positioned to further cement its position as a market and category leader in automotive reconditioning services.”
FS Investment Corporation II closed to new investors in March of 2014 and after raising $3.2 billion in equity capital.
FS Investment Corporation III, which has raised total gross proceeds of $874.7 million through December 16, 2014, is open to new investors.