Main Street Capital delays debt raise

Quick read
Americas, EMEA
Sunny Oh

Main Street Capital pulled an investment-grade bond offering on Tuesday in a reflection of the tough primary market faced by issuers this week, a marked contrast to the strong demand and hectic issuance seen in past January months, typically one of the busiest periods of the year.

The business development company was looking to raise a US$300m five-year senior unsecured bond through bookrunners RBC Capital Markets, SMBC Nikko and Truist. Despite putting forward a chunky yield in a shorter-dated maturity, Main Street Capital postponed the deal citing market conditions. Price whispers had been set at 220bp area over Treasuries.

The funds raised from the new bond would have paid down its outstanding US$180m 4.5% 2022 senior notes and debt under its credit facility.

Banks on the deal did not immediately respond to requests for comment.

This comes as deals from business development companies struggled to draw demand this week. On Monday FS KKR Capital had to hand a 9bp new issue concession for a US$500m five-year senior unsecured note offering, which was 1.4 times oversubscribed, according to IFR data.

On the same day Blackstone Private Credit Fund had to give away 7bp concessions for each of its new three-year and seven-year notes. Blackstone eventually bagged US$1.15bn off a thin order book of US$1.7bn.