Carlyle Secured Lending, Inc. · NASDAQ:CGBD
Carlyle Secured Lending — Merger or Acquisition (August 2024)
19 slides from Carlyle Secured Lending's merger presentation, August 2024
Slide 1: Overview of Proposed Merger between CGBD and CSL III
Overview of Proposed Merger between Carlyle Secured Lending, Inc. (“CGBD”) and Carlyle Secured Lending III (“CSL III”) August 2024 1
Slide 2: Disclaimer and Forward-Looking Statement
Disclaimer and Forward-Looking Statement This presentation (the “Presentation”) has been prepared by Carlyle Secured Lending, Inc. (together with its consolidated subsidiaries, “we,” “us,” “our,” “CGBD” or the “Company”) (NASDAQ: CGBD) and may only be used for informational purposes only. This Prese
Slide 3: Disclaimer and Forward-Looking Statement
Disclaimer and Forward-Looking Statement Information throughout the Presentation provided by sources other than the Company (including information relating to portfolio companies) has not been independently verified and, accordingly, the Company makes no representation or warranty in respect of this
Slide 4: Merger Overview
CARLYLE SECTION OI Merger Overview
Slide 5: Establishing a scaled, diversified middle-market BDC with $2.5B+ in total assets
+ Carlyle Secured Lending Establishing a scaled, (NASDAQ: CGBD), a business development company diversified middle-market focused on directly-originated BDC with $2.5B+ in total lending to sponsor-backed assets through an accretive, U.S. middle market companies, stockholder-friendly has entered into
Slide 6: Executive Summary
Executive Summary Situation Overview • Carlyle Secured Lending, Inc. (“CGBD”) is the flagship vehicle for Carlyle Direct Lending, focused on directly- originated lending to sponsor-backed U.S. middle market companies • Carlyle Secured Lending III (“CSL III”) is an SEC-registered private BDC managed
Slide 7: Merger Delivers Strategic Growth Benefits to Stockholders
Merger Delivers Strategic Growth Benefits to Stockholders The transaction is expected to be accretive to stockholders, and increased scale and efficiency are expected to drive long-term vehicle optimization Key Merger Benefits Drives Creates Eliminates Increases Scale Efficiency and Earnings and Pre
Slide 8: Summary of Proposed Transaction
Summary of Proposed Transaction Summary of Terms • CGBD to acquire 100% of CSL III in a stock-for-stock merger, with CSL III common shares to be exchanged for shares of CGBD common stock based upon an exchange Merger ratio determined shortly before the merger closes that has the potential to allow S
Slide 9: Summary of Proposed Transaction (Cont'd)
Summary of Proposed Transaction (Cont’d) Summary of Terms • Affirmative vote of a majority of voting CGBD stockholders where a quorum is Closing present Conditions • Certain regulatory approval and satisfaction or waiver of other closing conditions Management • Carlyle will continue to serve as the
Slide 10: CGBD Overview and Highlights
CGBD Overview and Highlights Total investments at fair value ($mm) $1,726 Floating Rate Senior Secured Exposure3 Weighted Average Yield on Income Producing Investments at Amortized Cost1 12.7% 100% 94% Number of investments 180 Number of portfolio companies 126 Company EBITDA4 Sponsored (Median) Ave
Slide 11: CSL III Overview and Highlights
CSL III Overview and Highlights Total investments at fair value ($mm) $369 Floating Rate Senior Secured Exposure Weighted Average Yield on Income Producing Investments at Amortized Cost1 12.2% 99% 99% Number of investments 103 Number of portfolio companies 77 Company EBITDA3 Sponsored (Median) Avera
Slide 12: Transaction Benefits
SECTION 02 Transaction Benefits 12
Slide 13: Potential Transaction Benefit: Scale and Market Visibility
Potential Transaction Benefit: Scale and Market Visibility Historically, BDCs with larger asset bases consistently trade with increased volume and improved price-to-NAV levels compared to smaller BDCs Increased Scale and Stock Liquidity 1 $26.1 3.5 $25 3.0 $20 (3M ADTV in millions) 2.5 +38% +61% $15
Slide 14: Carlyle Transaction Support
Carlyle Transaction Support Preferred Stock Exchange Current Preferred Dilution • Carlyle to exchange CGBD cumulative preferred stock for CGBD common stock at Share Impact from Conversion NAV (compared to current conversion price Convertible Preferred Amount ($mm) $50.0 of $8.98) shortly before the
Slide 15: Potential Transaction Benefit: Cost Savings
Potential Transaction Benefit: Cost Savings Operational Costs Financing Costs • Proposed merger expected to create operational • Increased scale expected to provide CGBD greater synergies by eliminating duplicative expenses access to the debt capital markets with increased • Scale expected to reduce
Slide 16: Overview of Proposed Merger Consideration
Overview of Proposed Merger Consideration • CGBD to acquire 100% of CSL III in a stock-for-stock merger, with CSL III common shares to be exchanged for CGBD common stock using an exchange ratio based on CGBD Market Price-to-NAV (“P/NAV”), which will be determined shortly before the merger closes. Th
Slide 17: Combined Entity Overview
SECTION 03 Combined Entity Overview 17
Slide 18: Near 100% CSL III Asset Overlap Facilitates Portfolio Integration
Near 100% CSL III Asset Overlap Facilitates Portfolio Integration As of 6/30/24 CGBD CSL III Combined Summary Statistics Investments at FV $1,726M $369M $2,095M Top 1 Investment1,2 2.2% 4.3% 1.9% Top 5 Investments1,2 10.4% 19.7% 9.0% Top 10 Investments1,2 19.4% 36.5% 17.2% Number of Investments 180
Slide 19: Standalone and Pro Forma Risk Ratings
Standalone and Pro Forma Risk Ratings (As of 6/30/24, $mm) CGBD CSL III Combined Internal Risk Rating Fair Value % of Fair Value Fair Value % of Fair Value Fair Value % of Fair Value 1 $0.4 0.0% - - $0.4 0.0% 2 1,142.4 83.3% 352.9 95.9% 1,495.3 86.0% 3 198.8 14.5% 15.0 4.1% 213.8 12.3% 4 12.7 0.9% 0
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