Junky BDC Great Elm Capital to Issue Baby Bonds

Great Elm Capital (NASDAQ) is selling a new baby bond issue of 2,280,000 shares.

Great Elm Capital holds 24% of their assets in Avanti Communications and 36% of their investment income in the last year was “payment in kind” from Avanti.  Avanti is a satellite operator and has had very significant difficulties and could fall into bankruptcy in the next year.

At this point in time this new issue has not been priced, but the BDC currently has a baby bond issue outstanding (NASDAQ:GECCL) with a coupon of 6.50% that is trading around $25.40/share indicating that this new issue should come to market in the 6.375% area.

Being a baby bond this issue will not trade on the OTC Grey Market prior to permanent exchange trading.

When further info is know we will post it here.

Preliminary information can be found here.