WASHINGTON (dpa-AFX) - Ares Capital Corp. (ARCC) announced that it plans to make a private offering of $150 million aggregate principal amount of its Convertible Senior Notes due 2017.
In addition, the company intends to grant the initial purchasers an option to purchase up to an additional $22.5 million principal amount of the Convertible Senior Notes to cover overallotments, if any. The Convertible Senior Notes will be offered only to qualified institutional buyers pursuant to Rule 144A under the Securities Act.
Ares Capital stated that the Convertible Senior Notes are unsecured, expected to pay interest semiannually and will be convertible under specified circumstances based on a conversion rate to be determined. Upon conversion, the company will pay or deliver, subject to the terms of the documents governing the Convertible Senior Notes, cash, shares of its common stock or a combination of cash and shares of common stock, at Ares Capital's election. Ares Capital added that it will not have the right to redeem the Convertible Senior Notes prior to maturity.
The company said it expects to use the net proceeds of this offering to repay or repurchase certain outstanding indebtedness, which may include repaying outstanding borrowings, if any, under its revolving credit facility and revolving funding facilities and for other general corporate purposes, including funding investments in its investment backlog and pipeline.
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