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MCLEAN, VA - Gladstone Capital Corporation (NASDAQ:GLAD), a business development company with a market capitalization of $582 million and an impressive InvestingPro Financial Health score of "GREAT," announced Monday it has commenced a registered public offering of $110 million in unsecured convertible notes due 2030, with plans to grant underwriters an option for an additional $16.5 million in notes.
The notes will be unsecured obligations paying interest semi-annually, with maturity in 2030 unless earlier converted, redeemed or repurchased. Upon conversion, the company may deliver cash, shares of common stock, or a combination of both, at its discretion. Specific terms including interest rate and initial conversion rate will be determined during pricing. According to InvestingPro data, the company maintains strong liquidity with a current ratio of 3.0, indicating robust ability to meet its short-term obligations.
Gladstone Capital intends to use the proceeds to repay a portion of its revolving credit facility debt and for general corporate purposes. Oppenheimer & Co. Inc. is serving as the sole book-running manager for the offering.
The offering is being conducted under the company’s shelf registration statement filed with the SEC in December 2023 and declared effective in January 2024.
Gladstone Capital Corporation is a publicly traded business development company that primarily invests in secured first and second lien term loans to lower middle market businesses in the United States. The company offers shareholders a notable 7.6% dividend yield and has maintained dividend payments for 25 consecutive years. Discover more detailed financial insights and analysis in the comprehensive Pro Research Report, available exclusively on InvestingPro.
The announcement, based on a press release statement, notes that completion of the offering depends on numerous conditions, many beyond the company’s control. The specific terms of the notes, including interest rate and conversion details, have not yet been finalized.
In other recent news, Gladstone Capital Corporation reported its Q3 2025 earnings, showing a 2.3% decline in total interest income, which amounted to $20.9 million. The company’s net investment income was $11.3 million, translating to $0.50 per share. These earnings figures come amid a backdrop of economic uncertainties. Despite the decline in interest income, the net investment income indicates a level of stability in the company’s financial performance. Investors might be cautious, as reflected in the stock’s recent movements, although such movements are not the focus here. The earnings report is a critical development for investors, as it provides insight into the company’s financial health during a challenging economic period.
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