Sixth Street Specialty Lending, Inc. · NYSE:TSLX
Sixth Street Specialty Lending — TPG Specialty Lending — Proxy Contest (April 2019)
14 slides from Sixth Street Specialty Lending's proxy contest presentation, Apr 5, 2019
Slide 1: Expanding Tools for Value Creation and Financial Flexibility
TPG Specialty Lending Expanding Tools for Value Creation and Financial Flexibility April 2019 http://www.tpgspecialtylending.com/
Slide 2: Disclaimer and Forward-Looking Statement
Disclaimer and Forward-Looking Statement General Disclaimer The information contained in this presentation (the ʺPresentationʺ) is preliminary, may not be complete and may be changed. By acceptance hereof, you agree that the information contained herein may not be used, reproduced or distributed t
Slide 3: Special Meeting of TSLX Stockholders
Special Meeting of TSLX Stockholders To Our Stockholders: We will be holding a Special Meeting of Stockholders of TPG Specialty Lending, Inc. on May 16, 2019, at 9:30 AM, local time, at the offices of Cleary Gottlieb Steen & Hamilton LLP, 450 Park Avenue, 28th Floor, New York, NY 10022. At the meeti
Slide 4: Market Conditions May Create Attractive Investment Opportunities
Market Conditions May Create Attractive Investment Opportunities Credit Market Dislocation (late 2015 – early 2016)4 From time to time, there may be volatility in the broader capital markets, (1) (2) disruption in liquidity in the debt capital Average BDC P/NAV BAML HY Index (OAS) markets, significa
Slide 5: Track Record of Strong Performance
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV 1 Performance Since TSLX IPO Track Record of Strong NI Return on Equity(2) NII Return on Equity(2) Performance TSLX BDC Peers (Mean) BDC Peers Top Quartile(1) TSLX BDC Peers (Mean) BDC Peers Top Quartile (1) 2018 Since TSLX IPO 2018
Slide 6: Track Record of Strong Performance: Total Returns Since IPO
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV 1 Total Returns (since TSLX IPO) Track Record of Strong $2.01 TSLX Total Returns Outperformance Performance (since IPO) versus: Leveraged Loans: +81 points BDC Peers: +77 points High Yield: +74 points $1.68 S&P 500: +33 points $1.26
Slide 7: Equity Raise Discipline
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV Equity Raise Discipline 1.55x TSLX BDC Peers(1) 1.40x TSLX Average: 1.17x Book 1.25x 2 to -Price—1.10x Disciplined 0.95x Allocation Capital 0.80x BDC Peers Average: 0.91x 0.65x Mar ‘14 Aug ‘14 Jan ‘15 Jun ‘15 Nov ‘15 Apr ‘16 Sep ‘16
Slide 8: Equity Raise Discipline (March 2018)
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV Equity Raise Discipline (March 2018) 14.3% 12.2% 13.0% 2 10.7% 9.2% Disciplined Capital 8.9% Allocation Cost of New Implied Yield on New ROE on New Equity(1) Breakeven Yield Assets (3) Equity(4) on New Assets(2) 2) 1) Average Reflec
Slide 9: Flexibility to sell common stock below NAV is in stockholders' best interests
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV Flexibility for the Company to sell its common stock below NAV is in the Company’s best interests and the best interests of its stockholders as it would provide: Access to the capital markets to pursue attractive investment oppor
Slide 10: Analysis Framework: Illustrative NAV Dilution
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV Analysis Framework Illustrative NAV Dilution (%)(2) % of Shares Outstanding Issued (0.7%) 5.0% 7.5% 10.0% 12.5% 15.0% 17.5% to 2.5% (0.1%) (0.2%) (0.2%) (0.3%) (0.3%) (0.4%) 5.0% (0.2%) (0.3%) (0.5%) (0.6%) (0.7%) (0.7%) (1) Discoun
Slide 11: Analysis Framework: Illustrative ROE Accretion / (Dilution)
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV Analysis Framework Illustrative ROE Accretion / (Dilution) on New Investments (%)(2) All-in Yield on New Assets 5.29% 10.0% 11.0% 12.0% 13.0% 14.0% 15.0% to 2.5% 1.0% 2.7% 4.4% 6.1% 7.8% 9.5% 5.0% 0.7% 2.4% 4.1% 5.9% 7.6% 9.3% (1) D
Slide 12: Analysis Framework: Illustrative Payback Period on Equity Raise
Reasons For TSLX to Have Flexibility to Sell Common Stock Below NAV Analysis Framework Illustrative Payback Period on Equity Raise (Years)(2) All-in Yield on New Assets 72.4 10.0% 11.0% 12.0% 13.0% 14.0% 15.0% to 2.5% 2.6 1.0 0.6 0.4 0.3 0.3 5.0% 7.4 2.2 1.3 0.9 0.7 0.6 (1) Discount 7.5% 18.4 3.8 2.
Slide 13: To Vote
To Vote The proxy statement is now available. You may use one of the following methods to provide your voting instructions: Vote by Internet: Online at www.proxyvote.com. Have your control number listed on the proxy card or voting instruction form ready and follow the instructions; or Vote by Teleph
Slide 14: For assistance voting your TSLX shares
For assistance voting your TSLX shares: D.F. King Toll-free at (800) 884-4275 or Collect at (212) 269-5550 For other questions: TSLX Investor Relations (212) 601-4753 (212) 601-4739 IRTSL@tpg.com