NMC is expected to distribute substantially all of its earnings to Solar Senior on a quarterly basis. Solar Senior anticipates its investment in NMC will generate a cash yield of approximately 11.0% and expects the acquisition to be immediately accretive to investment income in Q4 2017. Based on NMC's existing portfolio, it is currently anticipated that the investment would generate investment income for Solar Senior in the range of $1.4 million to $1.5 million per quarter. Pro forma for the acquisition, Solar Senior's net leverage is expected to be approximately 0.5x debt-to-equity."We believe that North Mill offers a compelling opportunity to invest in an established business operating in a less competitive niche with a management team that has consistently delivered incredibly strong credit performance," said Michael Gross, Chairman and CEO of Solar Senior. "The addition of North Mill's sourcing channel expands Solar Senior's ability to originate investments across multiple business lines in order to find attractive senior secured loans while also increasing the earnings power of Solar Senior's portfolio." "We believe this acquisition further positions us as a diversified specialty finance company, providing floating rate, senior secured cash flow and asset-based capital solutions to middle market companies. NMC, with its 100% collateralized loan portfolio across diversified industries, complements Solar Senior's healthcare asset-based lending business led by Gemino Healthcare Finance," said Bruce Spohler, Chief Operating Officer of Solar Senior. "We believe NMC's business is scalable and provides the Company with access to another differentiated middle market corporate credit platform which operates in a less competitive market focused on senior secured, collateral-based lending. NMC offers attractive risk-adjusted returns and has a low correlation to the broader non-investment grade credit markets. " "We at North Mill are excited to partner with Solar Senior Capital and the growth opportunities it provides the NMC platform," said Jeff Goldrich, President and Chief Executive Officer of NMC. "Solar Senior's stable, long-term funding will enhance North Mill's ability to provide innovative financing solutions to our clients."
ABOUT SOLAR SENIOR CAPITAL LTD.Solar Senior Capital Ltd. is a closed-end investment company that has elected to be treated as a business development company under the Investment Company Act of 1940. A specialty finance company with expertise in several niche markets, the Company primarily invests directly and indirectly in leveraged, U. S. middle market companies in the form of cash flow senior secured loans including first lien and second lien debt instruments and asset-based loans including senior secured loans collateralized on a first lien basis primarily by current assets. ABOUT NORTH MILL CAPITAL LLC North Mill Capital is a leading asset based lending company with full service offices in Princeton, New Jersey and Minneapolis, Minnesota. NMC provides asset-based loans to businesses with borrowing needs up to $30 million and finances manufacturers, service companies, and distributors nationwide. NMC was founded by its management group in 2010 after having successfully built another commercial finance company which was started in 1995. FORWARD-LOOKING STATEMENTS Statements included herein may constitute "forward-looking statements," which relate to future events or the future performance or financial condition of Solar Senior and NMC. These statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Solar Senior and NMC operate in a very competitive and rapidly changing environment, in which new risks emerge from time to time. Some of the factors that could cause actual results to differ materially from the forward-looking statements contained herein include, without limitation: (i) NMC's ability to maintain its historical financial performance, (ii) departures of key members of the NMC's management team following closing, and (iii) material adverse changes to the portfolio of assets held by NMC as of or following the closing. For a more detailed discussion of factors related to Solar Senior's business, see the information under the captions "Risk Factors" in Solar Senior's most recent annual report on Form 10-K and its subsequent quarterly reports on Form 10-Q filed with the Securities and Exchange Commission. Given these risks and uncertainties, you should not place undue reliance on these forward-looking statements. Solar Senior undertakes no duty to update any forward-looking statements made herein, unless required to do so by law.
Contact: Investor Relations (646) 308-8770Contact: Investor Relations (646) 308-8770