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Jun. 16, 2015, 12:46 PM
- There's a bit of movement in the stock prices of MCG Capital (MCGC +1.1%) and HC2 Holdings (HCHC +4.3%) following the latest revised offer from Phil Falcone in which he promised to reimburse MCG for not just the $7M cash breakup fee with PennatPark Floating Rate (PFLT +0.2%), but also another $13.35M (in HC2 stock) if HC2 cannot close the purchase.
- Previous bids by HC2 (now up to $5.30 per share) have done little to affect the stock price of MCG, but the shares today have moved to their highest level since the bidding war started.
- HC2 is on the move, perhaps suggesting better odds of the company getting its hands on the roughly $175M in cash and liquid investments on the books at MCG.
- With today's gain, MCG Capital's stock price is up to $4.72.
- For its part, MCG Capital acknowledges receipt of the latest foray from Falcone and says its will study the bid.
May 19, 2015, 9:31 AM
- Phil Falcone's HC2 (NYSEMKT:HCHC) proposes a cash and stock deal to purchase MCG Capital (NASDAQ:MCGC) for $5.25 per share. Consideration would be in the form of $4.75 worth of HC2 common stock and $0.50 in cash.
- HC2's previous bid was for $5.00 in cash and stock.
- MCG's deal with PennantPark Floating Rate Capital (NASDAQ:PFLT) is for $4.75 per share in cash.
- Believing HC2's offer represents a "superior proposal," Falcone again asks the MCG board to engage in discussions.
- MCGC +1.7% to $4.68.
- Previously: Falcone's HC2 goes over the top for MCG Capital (May 4)
May 4, 2015, 3:06 PM
- Acknowledging receipt of HC2's (HCHC +0.5%) proposed acquisition deal, MCG Capital (MCGC +2.9%) says it will review the offer, but for now continues to stand behind its agreement with PennanPark Floating Rate Capital (PFLT -0.1%) to sell itself to that company for $4.75 per share in cash.
- Previously: Falcone's HC2 goes over the top for MCG Capital (May 4)
May 4, 2015, 8:53 AM
- HC2 Holdings (NYSEMKT:HCHC) intends to offer $5 per share in cash and stock for MCG Capital (NASDAQ:MCGC) versus the $4.75 cash bid made last week by PennantPark Floating Rate Capital (NASDAQ:PFLT).
- HC2's offer includes either 0.434 share of HC2 common stock or 0.191 share of a newly created preferred issue, and $0.226 in cash.
- The total deal value of $185.4M compares to PFLT's $175M.
- MCGC +3.5% premarket to $4.70.
- Previously: MCG Capital finds a buyer (April 29)
- Related: 8% Yield With Interest Rate Protection From PennantPark Floating Rate Capital (May 1)
Apr. 29, 2015, 9:17 AM
Apr. 29, 2015, 7:23 AM
Feb. 9, 2015, 9:49 AM
- MCG Capital (MCGC +4.2%) has hired Morgan Stanley to assist in exploring strategic alternatives, including a possible sale. The troubled company has bought back a load of stock and successfully tendered for another almost 5M shares late last year.
- Last reported book value (Sept. 30) was $4.48. The current price is $3.96.
Dec. 12, 2014, 12:43 PM
- The final results of MCG Capital's (MCGC +8.4%) Dutch Auction tender found 4,86M shares tendered for $3.75 each, representing 11.2% of the float.
- Earlier this week, the company said it expects to begin its repurchase program which had been suspended while the tender offer was outstanding. Under applicable law, buybacks may not commence until December 18. Including the stock repurchased in the tender, the company has bought back more than 31M shares this year for more than $117M.
Oct. 29, 2014, 12:45 PM
Oct. 29, 2014, 9:15 AM
Oct. 29, 2014, 9:12 AM
- Reopened for trade, MCG Capital (NASDAQ:MCGC) is ahead 14.5% to $3.48 after the company launches a Dutch Tender for more than half the float.
- Turning to operations, the company reported net interest income of $4M, down 62.6% from a year ago as the company shed investments.
- NAV per share of $4.48 vs. $4.74 at 2014's start.
- 2.45M shares repurchased during quarter at an average price of $3.52 each.
- "We believe that current market conditions in our primary lending markets are consistent with a peak of a credit cycle. We believe that we have successfully monetized challenging investments into a very liquid market, improving the quality of our assets and our cash position and resulting in a stronger balance sheet."
- Previously: MCG Capital misses by $0.01, misses on revenue
Oct. 29, 2014, 8:10 AM
- The "Dutch Auction" tender offer for up to $75M of MCGC stock at a price no less than $3.25, nor greater than $3.75 is expected to commence on Nov. 3 and expire on Dec. 3. The stock has fallen by 42% Y/Y, and closed last night at $3.04.
- The maximum number of shares which could be purchased under the tender is about 53% of the float.
- Shares are currently under trading halt.
Mar. 11, 2014, 8:45 AM
- Remove Hagen Saville from the CEO slot and from the board, initiate a Dutch Tender to buy back shares at up to $4.60 each, abandon plans to boost the origination staff, and begin looking for a buyer of the company, urges longtime MCG Capital (MCGC) investor Richard Fearon in an open letter published on Seeking Alpha.
- Fearon notes the curiosity of Saville's plan to add new hires in originations when - on last week's earnings call - Saville said conditions "are consistent with the peak of the credit cycle." Instead, purchases of company stock at the current price (20% discount to NAV) will provide an immediate large return to shareholders, not to mention the additional dividend yield.
- Shares +3.2% premarket
Mar. 5, 2014, 12:45 PM
Mar. 5, 2014, 11:43 AM
- It's a tough earnings call for MCG Capital (MCGC -9.2%) after guiding to a sharply lower distribution this year in a tough environment for finding investments (it hasn't yet booked one in Q1).
- Listen to a replay on Seeking Alpha.
- With net asset value per share of $4.74 (off from $5.18 a year ago, and $5.65 two years ago), management spent a good portion of the call fielding questions about putting the company up for sale or being far more aggressive with buybacks (current stock price is $3.99).
- Hoping to jump-start business, the company promotes CFO Keith Kennedy to President.
- Earlier coverage of today's earnings
Aug. 15, 2013, 11:12 AM
- Anything paying income is again being particularly hard hit by the rise in Treasury yields (the 10-year now at a 2-year high of 2.8%).
- Selections in mREITs (REM -2.1%), (MORT -1.9%) include RAIT Financial Trust (RAS -4.1%) - whose IRT had an ill-timed IPO yesterday and Ellington Residential (EARN -4.8%) - the market not caring about reasonable Q2 performance, a hefty discount to book, and the launch of a repurchase program. Other mREITs: CYS Investments (CYS -3.6%), Apollo (AMTG -3%), Newcastle (NCT -5%), Invesco (IVR -2.7%), Arlington Asset (AI -1.2%). A leveraged ETF play: MORL.
- Hanging in there relatively well are the BDCs: Fifth Street (FSC -1.3%), Triangle (TCAP -1%), MCG (MCGC -1.2%), Hercules (HTGC -1.2%), Ares (ARCC -0.3%).
- BDC ETFs: BDCS, BDCL, BIZD.
- In emerging markets fixed income, a trader takes note of EDD, a closed-end fund now trading at more than a 15% discount to NAV.
- Emerging market bond ETFs: EMB, LEMB, PCY, EMLC, ELD, PFEM, EBND, VWOB.
MCG Capital Corporation is a solutions-focused commercial finance company that provides capital and advisory services to middle-market companies in the United States. It is aninternally managed, non-diversified, closed-end investment company.
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