* Facility a third source of funding for new investments
* Facility has a targeted initial close of $65 mln
Feb 25 Business development company Fifth
Street Finance Corp FSC.N said it received a $150 million
financing commitment from ING Capital LLC, a unit of ING Bank
NV ING.AS, for a syndicated three-year revolving credit
The facility is a two-year secured revolving credit
facility with a one-year term out, and will bear interest at a
rate of LIBOR plus 4.5 percent per annum, with no floor, it
The facility has a targeted initial close of $65 million,
the company said.
The financing comes after Fifth Street's unit received
committee approval for a license from the U.S. Small Business
Administration (SBA) to operate as a small business investment
company (SBIC) in January. [ID:nSGE60C0JJ]
Under the SBIC program, if a business development company
(BDC) is seeking a loan of $150 million, it should first make
investments of $75 million out of its own funds.
Fifth Street said in January it will offer 7 million of its
common shares at a price of $11.20 apiece.
BDCs make loans to small and mid-sized businesses in return
for equity stakes.
Shares of the company closed at $11.24 Thursday on the New
York Stock Exchange.
(Reporting by Abhinav Sharma in Bangalore; Editing by Maju