Contact Information: Please send investment proposals to: Grier Eliasek President and Chief Operating Officer grier@prospectstreet.com (212) 448-9577
Prospect Capital Announces 31% IRR Monetization of Cougar Pressure Control
| Source: Prospect Capital Corporation
NEW YORK, NY--(Marketwire - May 2, 2008) - Prospect Capital Corporation (NASDAQ : PSEC )
("Prospect") announced today that Prospect has now fully exited its
investment in Arctic Acquisition Corp., dba Cougar Pressure Control
("Cougar").
Prospect initially invested $9.25 million in Cougar in July 2005 in the
form of a senior secured loan, and that loan was subsequently increased by
$6.0 million. Prospect received a minority equity interest in Cougar as
additional consideration for making the secured loan. In August 2007,
Cougar repaid in full the Prospect loan, and Prospect retained its equity
interest in Cougar.
Cougar has now acquired Prospect's equity interest in Cougar for $3.4
million. With this further monetization, Prospect exits its Cougar
investment entirely with a 31% cash on cash internal rate of return on its
combined debt and equity investment, representing an approximately 1.5
times cash on cash multiple.
ABOUT PROSPECT CAPITAL CORPORATION
Prospect Capital Corporation (www.prospectstreet.com) is a closed-end
investment company that lends to and invests in private and microcap public
businesses. Prospect Capital's investment objective is to generate both
current income and capital appreciation through debt and equity
investments.
Prospect Capital has elected to be treated as a business development
company under the Investment Company Act of 1940 ("1940 Act"). We are
required to comply with a series of regulatory requirements under the 1940
Act as well as applicable NASDAQ, federal and state laws and regulations.
We have elected to be treated as a regulated investment company under the
Internal Revenue Code of 1986. Failure to comply with any of the laws and
regulations that apply to Prospect Capital could have a material adverse
effect on Prospect Capital and its shareholders.
This press release contains forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Any such
statements, other than statements of historical fact, are likely to be
affected by other unknowable future events and conditions, including
elements of the future that are or are not under the Company's control, and
that the Company may or may not have considered; accordingly, such
statements cannot be guarantees or assurances of any aspect of future
performance. Actual developments and results are highly likely to vary
materially from these estimates and projections of the future. Such
statements speak only as of the time when made, and the Company undertakes
no obligation to update any such statement now or in the future.