Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Prospect Capital Corporation (NASDAQ: PSEC) (“Prospect”) announced today that Prospect has made a senior secured debt investment of $26.5 million to support the acquisition of ST Products, LLC (“STP”) by Quilvest Private Equity and Malakand Capital.
Headquartered in Duncansville, Pennsylvania, STP is the leading North American producer of precision redrawn, small diameter, thin wall copper, and specialty alloy tubes. STP is the technical and service leader in its industry, with leading market share in its end markets and a reputation for exceptional technical capabilities, product quality, and delivery reliability.
“ST Products has a compelling value proposition and proven business model,” said Benton Cummings, a Managing Director of Prospect Capital Management. “We are excited to provide financing to support the company’s next phase of growth.”
Separately, Prospect provided $24 million in first lien senior secured financing for the recapitalization of a leading company in the technology accessory industry.
Prospect also provided $35 million in secured second lien financing for the recapitalization of a top company in the window covering industry.
Prospect has closed more than $500 million of new originations since December 31, 2010. Prospect has closed over $200 million in new originations in the current quarter, with the current quarter not yet complete. Prospect also has a near-term potential pipeline in excess of $300 million.
In addition, Prospect announced it has received full repayment of its loans to Prince Minerals, Inc. (“Prince”), thereby resulting in accelerated accretion income of $10.5 million related to the original purchase discount of such loans from Patriot Capital Funding, Inc. Prospect realized a 3.1 times cash on cash return and an internal rate of return in excess of 100% from the Prince investment.
ABOUT PROSPECT CAPITAL CORPORATION
Prospect Capital Corporation (www.prospectstreet.com) is a closed-end investment company that lends to and invests in private and microcap public businesses. Our investment objective is to generate both current income and long-term capital appreciation through debt and equity investments.
Read the full news release here.
