Business
Capital Southwest Receives “Green Light” Letter from the U.S. Small Business Administration to Submit Its Second SBIC License Application
DALLAS, Dec. 10, 2024 (GLOBE NEWSWIRE) -- Capital Southwest Corporation (“Capital Southwest” or the “Company”; Nasdaq: CSWC), an internally managed business
About this update from Capital Southwest Corporation
[{"type":"text","content":"DALLAS, Dec. 10, 2024 (GLOBE NEWSWIRE) -- Capital Southwest Corporation (“Capital Southwest” or the “Company”; Nasdaq: CSWC), an internally managed business development company focused on providing flexible financing solutions to support the acquisition and growth of middle market businesses, today announced that the U.S. Small Business Administration (the “SBA”) has issued a “green light” letter inviting Capital Southwest to submit its application to obtain a license to operate a second Small Business Investment Company (“SBIC”) subsidiary. “Our partnership with the SBIC program continues to be an important strategic priority for Capital Southwest and a natural fit with our core lower middle market investment strategy,” said Michael Sarner, Chief Financial Officer of Capital Southwest. “Access to additional SBA debentures will continue to diversify our sources of attractive long-term capital and enable Capital Southwest to maintain balance sheet funding flexibility through capital market cycles. We look forward to continuing to work with the SBA to complete this process.” Upon approval, Capital Southwest would receive its second SBIC license which would provide the Company with access to up to an additional $175 million of growth capital through SBA-guaranteed debentures, bringing Capital Southwest’s combined borrowing capacity through the SBIC program to a total of $350 million. SBA debentures have maturities of ten years and have fixed interest rates tied to the U.S. 10 Year Treasury rate. Receipt of a green light letter from the SBA does not assure an applicant that the SBA will ultimately issue an SBIC license, and Capital Southwest has received no assurance or indication from the SBA that it will receive an SBIC license, or of the timeframe in which it would receive a license, should one be granted. The SBA program has played a pivotal role within Capital Southwest’s lower middle market investment strategy since receiving its first SBIC license in April 2021. Capital Southwest received exemptive relief from the Securities and Exchange Commission that allows for the exclusion of SBIC leverage from the Company’s applicable asset coverage limits. About Capital Southwest Capital Southwest Corporation (Nasdaq: CSWC) is a Dallas, Texas-based, internally managed business development company with approximately $1.5 billion in inve...