Fund is a Non-Traded Business Development Company that Invests in the Debt of Private U.S. Companies
FS Investment Corporation II (“FSIC II”) successfully completed its minimum offering requirement of $2.5 million in capital raised from persons not affiliated with FSIC II and admitted its initial public investors as stockholders. FSIC II is a publicly registered, non-traded business development company focused on investing primarily in the debt securities of private companies throughout the United States, with the investment objectives of generating current income and, to a lesser extent, long-term capital appreciation for its investors. FSIC II has registered for public sale in a continuous offering up to $2.0 billion of its shares of common stock, at an initial offering price of $10.00 per share. Going forward, FSIC II intends to accept subscriptions on a continuous basis and issue shares at its semi-monthly closings.
FSIC II’s launch was bolstered by a successful pre-launch private placement. Individuals and entities, including those affiliated with FSIC II’s sponsor, Franklin Square Capital Partners (“Franklin Square”), and sub-adviser, GSO / Blackstone Debt Funds Management LLC (“GDFM”), invested approximately $18.4 million in FSIC II in the private placement. GDFM is an affiliate of GSO Capital Partners LP (“GSO”), the credit platform of The Blackstone Group L.P. (“Blackstone”). Investors in the private placement were admitted to the fund at the same net share price as initial investors in the public offering. Franklin Square will bring its commitment to best practices and transparency to FSIC II, including fully-earned distributions that are not funded with offering proceeds or borrowings, mark-to-market pricing and the aforementioned significant sponsor commitment.
FSIC II offers investors access to the private debt asset class at a minimum initial investment of $5,000, enabling them to employ similar investment strategies as large institutions and high net worth individuals. FSIC II expects to invest primarily in the floating rate senior secured loans of established private U.S. companies and will focus on preserving capital and producing current income.
“We believe that individual investors can benefit from the portfolio diversification offered by alternative investment products like FS Investment Corporation II, which provides access to a class of investments that were once only available to endowments and high net worth investors,” said Michael C. Forman, Chairman and Chief Executive Officer of FSIC II. “With the closing of FS Investment Corporation, the first non-traded business development company, FSIC II will provide investors with continued access to a core income product sponsored by Franklin Square. Looking ahead, we see a favorable outlook for long-term investors in the senior secured loan market over the anticipated life of FSIC II.”