FS KKR Capital Corp. II Lists on New York Stock Exchange
June 18, 2020 | Luke Schmidt | Blue Vault
On June 17, 2020, FS KKR Capital Corp. II (“FSKR”) announced that its shares of common stock began trading on the New York Stock Exchange under the ticker symbol “FSKR.” The Company’s share price opened at $13.75, reaching a high of $14.60, before closing at $14.30 per share. FSKR, together with its affiliate, FS KKR Capital Corp. (NYSE: FSK), represents the second largest publicly traded BDC platform in the market.
Michael Forman, Chief Executive Officer of FSKR, commented, “We are pleased to complete the listing of FSKR on the NYSE and deliver on our commitment to shareholders. We believe that the listing serves as a catalyst to unlock significant capital which can be deployed to help maximize shareholder value as well as further strengthen FSKR’s position as a leading BDC.”
Daniel Pietrzak, Co-President and Chief Investment Officer of FSKR, added, “Following the listing, FSKR anticipates shareholder approval of its proposal to decrease its asset coverage requirement, which would enable FSKR to access in excess of $1 billion of previously committed financing lines across its balance sheet. This additional flexibility will enhance our investment capacity as we support our existing portfolio companies and think strategically about expanding our portfolio through new investments.”
On June 10, 2020, FSKR effected a 4 to 1 reverse split of its shares of common stock. As a result, every four shares of FSKR common stock issued and outstanding were automatically combined into one share of FSKR common stock, and the number of outstanding shares was reduced from approximately 691.2 million to approximately 172.9 million. As adjusted to give effect to the reverse stock split, FSKR’s net asset value per share as of March 31, 2020 would have been $24.68, instead of $6.17 per share.
As previously announced, on May 26, 2020, FSKR’s Board of Directors authorized a share repurchase program. Under the program, FSKR may repurchase up to $100 million in aggregate of its outstanding common stock in the open market. The timing, manner, price and amount of any share repurchases will be determined by FSKR, in its discretion, based upon the evaluation of economic and market conditions, FSKR’s stock price, applicable legal and regulatory requirements and other factors. Additionally, certain affiliates of the owners of FSKR’s investment advisor, FS/KKR Advisor, LLC, have committed $100 million to a $350 million investment vehicle that may invest from time to time in shares of FSKR and its affiliate, FSK. There can be no assurance that FSKR or the investment vehicle will purchase any FSKR shares.
FSKR is the result of four nontraded BDCs advised by FS/KKR Advisor merging in December of 2019. FS Investment Corporation III, FS Investment Corporation IV, and Corporate Capital Trust II merged with and into FS Investment Corporation II, with FS Investment Corporation II surviving the merger and being renamed FS KKR Capital Corp. II. As of March 31, 2020, FSKR reported total assets of approximately $8.2 billion with total investments of approximately $7.5 billion. FSKR seeks to invest primarily in the senior secured debt and, to a lesser extent, the subordinated debt of private middle market companies. FSKR is advised by FS/KKR Advisor, LLC.
Sources: SEC, Blue Vault
