March 21 Shares of TPG Specialty Lending Inc
, the business development company of private-equity
firm TPG Capital, rose about 3 percent in their debut,
valuing the company at about $852 million.
TPG Specialty Lending (TSL) raised about $112 million after
its IPO of 7 million shares was priced at $16 per share, the low
end of the expected range.
TSL's shares opened at $16.05 and touched a high of $16.45
Friday on the New York Stock Exchange.
The business development company (BDC) has raised $1.5
billion from investors, including a $117.1 million commitment
from its parent, since its launch in 2011.
BDCs, which are pools of capital that invest in debt of
small- and middle-market companies, often go public and pay out
at least 90 percent of their annual profits as dividends to
avoid corporate taxation.
Demand for BDCs has jumped as tighter lending guidelines and
the difficulty of raising capital curbs traditional lenders.
TSL is led by Joshua Easterly, former managing director at
Goldman Sachs Group Inc and Michael Fishman, former
executive vice president and national director of loan
originations for Wells Fargo Capital Finance.
The stake of State of New Jersey Common Pension Fund, the
largest shareholder in TSL, will drop to 11.6 percent from 14.4
percent after the offering.
Net proceeds from the offering would be used to repay debt
and invest in portfolio companies, San Francisco-based TSL said
in a regulatory filing.
The company reported gross internal rate of return of 17.6
percent on investments it has exited from inception through the
end of 2013. Net investment income more than doubled to $57.5
million in 2013 from a year earlier.
JP Morgan, Bank of America Merrill Lynch and Goldman Sachs &
Co were lead underwriters to the offering.
(Reporting by Avik Das in Bangalore; Editing by Savio D'Souza)