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MIAMI, Jan. 02, 2025 (GLOBE NEWSWIRE) -- PennantPark Investment Corporation (the “Company”) (NYSE: PNNT) announced that PennantPark Senior Loan Fund, LLC (“PSLF”) through its wholly-owned and consolidated subsidiary, PennantPark CLO X, LLC (“CLO X”) has closed a four-year reinvestment period, twelve-year final maturity, $400.5 million debt securitization in the form of a collateralized loan obligation (“CLO”).
The debt issued in the CLO (the “ Debt”) is structured in the following manner:
| Class | Par Amount |
| % of Capital Structure | Coupon | Expected Rating | Issuance Price |
| Class A-1 Notes | $158,000,000 |
| 39% | 3 Mo SOFR + 1.59% | AAA | 100.0% |
| Class A-1 Loan | 30,000,000 |
| 7% | 3 Mo SOFR + 1.59% | AAA | 100.0% |
| Class A-1W Loan | 40,000,000 |
| 10% | 3 Mo SOFR + 1.59% | AAA | 100.0% |
| Class A-2W Loan (*) | 16,000,000 |
| 4% | 3 Mo SOFR + 1.75% | AAA | 100.0% |
| Class B Notes | 28,000,000 |
| 7% | 3 Mo SOFR + 1.85% | AA | 100.0% |
| Class C Notes | 32,000,000 |
| 8% | 3 Mo SOFR + 2.40% | A | 100.0% |
| Class D Notes | 24,000,000 |
| 6% | 3 Mo SOFR + 3.85% | BBB- | 100.0% |
| Subordinated Notes | 72,500,000 |
| 18% | NA | NR | NA |
| Total | $400,500,000 |
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(*) Holders of Class A-2W Loans are eligible to convert their loans to Class A-2 Notes in accordance with the Conversion Option feature, as provided in the CLO X Indenture.
“We are thrilled by the continued progress of our CLO business, with the milestones of issuing our tenth CLO and crossing over $3 billion in AUM within our CLOs,” said Arthur Penn, Chief Executive Officer. “We believe that this financing positions us well to continue to capture the opportunity in the core middle market, where our capital is strategic to our borrowers. As a result, we believe that the risk adjusted return of our investments are attractive due to higher yields, lower leverage and covenants which are not available in the upper middle market.”
With the closing of CLO X, PennantPark now manages approximately $3.2 billion in CLO middle market assets.
PSLF will retain all the Subordinated Notes through a consolidated subsidiary. The reinvestment period for the term debt securitization ends in January 2029 and the Debt is scheduled to mature in January 2037. The term debt securitization is expected to be approximately 100% funded at close. The proceeds from the Debt will be used to repay a portion of PSLF’s $400 million secured credit facility. In addition, PSLF acts as retention holder in the transaction to retain exposure to the performance of the securitized assets. BNP Paribas acted as lead placement agent on the CLO transaction.
The notes offered as part of the term debt securitization have not been and will not be registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state “blue sky” laws, and may not be offered or sold in the United States absent registration under Section 5 of the Securities Act or an applicable exemption from such registration requirements. The CLO is a form of secured financing incurred and consolidated by PSLF. This press release shall not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of the notes in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.