BDC Fidus Investment to Offer Notes

Business Development Company Fidus Investment (NASDAQ:FDUS) is offering a new baby bond. Full details are not yet available.

The notes will have an early redemption available in 2021 and will mature in 2024.

The notes will trade under the ticker of FDUSZ when they begin to trade in the next 10 days or so. There will be no OTC Grey market trading of this debt issue.

The issue is not rated and payments will be interest so there is no preferential tax treatment (NOT QDI).

At this time Fidus remains under the need to have a 200% asset coverage ratio–but this could change to 150% in the future.

Preliminary information is available here.

The company has 1 other baby bond issue outstanding–the 5.875% notes due 2023 (NASDAQ:FDUSL).

6 thoughts on “BDC Fidus Investment to Offer Notes”

  1. Tim, I believe you mean the common is FDUS and not FIDUS. Wishing you profitable investing, Nomad

      1. Tim, any thought on this IPO or are you awaiting more information? Thank you, Nomad

        1. I did a quicky review of their financials and I am not overly impressed–but like all the BDCs the company is probably fine until economic conditions soften. Fidus holds mostly 2nd liens in their portfolio–I always would prefer a 1st lien. Likely I won’t do anything because it will come at maybe 5.875% and the risk/reward just isn’t there for a conservative person.

          1. FDUS baby bond does not make sense, bad risk to reward ratio as you two have opined. Back on 10/18/2017, I bought quite a few FDUS common shares, following BDC BUZZ, who opined something like “if you like TSLX, you would love FDUS”. In hindsight, Rida et. al. does have a patent to push their sales pitch. I bought a whole bunch at $16.586 including commission. I sold most of the shares on 5/18/2018 @ $13.87 with net loss but kept 300 shares, following some post made by Lord Xot of SI. Today, with a nice jump of 2+%, I can sell these shares with just a few dollars of net loss (giving back all the dividends received.
            Rida’s best BDC independent site does suggest that FDUS is trading below NAV. With riding tides, all the risky stuff, except AFSI seem to follow.

            The best of Rida remains ARCC. I picked up just a few shares by selling SuperSwan with low yield, KEY-J cap loss nicely offset by dividends received and bought ARCC earlier this morning plus PBC perhaps paid a little too much @ 25.11 just for another 100 shares added to my nice 200 shares below par picked up at IPO. You can get it at $25.05 now. BBB rated baby bond, if I recall correctly from a bad reputed PSEC should still be good IMHO. I tried to get SAF (term limited), seller is very stubborn and I have ZERO patience. Let them raise the rate to a ridiculous level or frequency, then there will be corrections or worse, driving everything down long before inflation IMHO. All the BDC’s picked up following Scott Kennedy presumably well respected in SA community did no better, MAIN and SLRC. I intend to get rid them all once I get the money back with no net loss. ARCC did cut dividends back in 2008 and 2nd Tip of 2009. It bounced back nicely. MAIN is also okay but with puny dividends and NAV BELOW market value. It does not make sense to me. One SA writer is experimenting with BDC + mREIT. Worked for him since 2014. When I tried to plot charts between NLY common vs. ARCC for example, it actually performed better than SP 500 hands down.
            Wow. Gridbird and Tim’s NI-B shot up sky high. Now $26.91+ reached $27. Incredible. Perhaps I should sell my 200 shares in my IRA and plow the proceeds to Gridbirds RNR-C betting on NOT CALLED any time soon (which is seldom played in my perpetual way). OR UNMA without call risk.
            Thank you, Tim.

            1. I really should try to see if I can reduce my legacy positions in AHT. I did sell my higher coupon ones without loss. With all the lower ones, I need to figure if there is net loss AND how much. I have way too many shares of various AHT preferreds, 7.35% and 7.5% I shares etc. AHT common seem to came back with the current euphoric high tide. Terrible balance sheet no doubt. All EBITDA play.

              That Saltzman guy CEO of CLNY, is certainly no better, after raping the then Northstar, he failed to make the company whole. I do need to deleverage these higher risk positions, plus lots of Shippers. BTW, my NI-B did not trigger but then this is probably not as important. Not even counting Je-A and SPKEP.

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