BDC Trinity Capital (TRIN) has priced their new issue of notes due 2029.
The issue prices at 7.875% for 4 million shares plus 600,000 more available for overallotment.
The notes are rated BBB by Egan-Jones and BBBL by Morningstar (not sure how Morningstar rates debt so will have to do some digging).
The company ‘use of proceeds statement is as follows–
The Issuer expects to use the net proceeds from this offering to pay down a portion of its existing indebtedness under the KeyBank Credit Agreement and, depending on the remaining amount of net proceeds after such use, to redeem a portion of its outstanding 2025 Notes.
The pricing term sheet is here.
What do they mean by “depending on the remaining amount of net proceeds after such use, to redeem a portion of its outstanding 2025 Notes.”
Is that referring to TRINL which has a maturity date of 1/16/25? Or is there other 2025 debt they are referring to?
Mark–they are referring to TRINL.
Tim:
Although I like and prefer your quarterly interest, I calculate the quarterly interest at $0.4921875, rounded to $0.4922 NOT $1.4920.
Yes–I like it too. Thanks Dave will correct it.
I would like to know what it is about their credit agreement with Key bank that is requiring them to issue a 7-7/8% baby bond to pay them back? Any one have an idea?
Charles good call out. Looking at the 10K it has looks like it is enterting an ammortization period and the loan matures in 2026. The rate is SOFR +3.25%. There is quite a bit of other debt with near in maturities as well.
They have 2 bonds maturing in 2026 you can try getting for a 7% yield
90% of their debt is coming due in the next 2 years so this may not be the last note coming to market. At least Key is getting their money.
Charles –
there is straight debt maturing in 2025, convrts due 2025 and two tranches of straight debt due in 2026 in addtion to the key bank loan. So it looks like they are generally cleaning up the balance sheet. They are also very light on cash.
I have not dug into their investment potfolio/loan book.
A lot of it is in life sciences…
As always it will be interesting to see how these trade.
I could be interested in these. I have been looking for some notes in a BDC and I am interested in the venture debt asset class that TRIN is offering.
I am definitly going to sharpen my pencile on this issue.
Maybe the “L” is like a minus that other rating agencies use?
“Morningstar DBRS also assigned an investment grade credit rating of “BBB (low)” to the Company’s long-term senior debt”
https://www.prnewswire.com/news-releases/trinity-capital-receives-investment-grade-rating-from-morningstar-dbrs-302049965.html