Moelis-Affiliated Steele Creek BDC Wins Shareholder Approval to Liquidate
Shareholders of Steele Creek Capital Corporation on Oct. 13 approved a plan to liquidate and dissolve the privately offered business development company and authorized its board to withdraw the fund’s election to be regulated as a BDC.
About 3.81 million shares voted for each proposal at the special meeting, or about 66.5% of the roughly 5.74 million shares outstanding on the Sept. 28 record date. The company did not report any votes against either proposal or any abstentions.
As of the record date, Moelis & Company executive chairman and founder Kenneth Moelis beneficially owned about 2.65 million shares, or 45.89% of the outstanding stock. The fund’s directors and executive officers as a group held 47.80%.
Steele Creek is externally managed by Charlotte, N.C.-based Steele Creek Investment Management LLC, an affiliate of Moelis Asset Management LP. The fund invests primarily in fixed-income instruments, including broadly syndicated bank loans. It has operated as a BDC since October 2020 and sold shares privately through dealer manager S2K Financial LLC, with upfront sales loads of up to 5.5%. It had 190 beneficial owners as of the record date.
Under the plan of liquidation, the fund will cease operating as an investment company after the plan takes effect Dec. 1 and will then sell its remaining assets, pay its liabilities, and distribute what is left to shareholders. The company said it expects the final liquidating distribution by year-end. The plan requires the final distribution no later than one day before the second anniversary of the effective date. The company estimated liquidation costs at about $200,000, which the fund will pay.
After withdrawing its BDC election, Steele Creek plans to end its registration under the Securities Exchange Act of 1934 and stop filing periodic reports.
The board unanimously approved the plan on Sept. 21. The board cited the fund’s “sub-scale size,” the difficulty of raising equity capital, an expected continued decline in assets, and the cost of maintaining BDC and public-reporting status. It said a liquidation could let shareholders realize net asset value for their shares rather than sell to a third party at a discount. The board said it had also considered converting the fund to a nontraded, publicly offered BDC or to an interval fund. It decided those options would likely add costs, risks, and complications compared with an orderly liquidation.
The vote follows the August sale of most of the fund’s portfolio, which AltsWire reported when the board said it was weighing a full liquidation and dissolution that would need shareholder approval.
The board approved a deleveraging plan Aug. 17. On Aug. 18, the adviser sold 164 broadly syndicated loans through a “Bids Wanted in Competition” auction to more than 22 dealers. The loans made up 75.8% of the portfolio’s fair value as of June 30. The sales brought in gross proceeds of about $73 million, and the fund realized a net loss of $1.7 million. The company said the sale prices were about $462,000 above the loans’ June 30 valuations.
The company said it would use about $65 million of the proceeds to repay in full its credit facility with Bank of America, N.A., which it elected to terminate without early-termination penalties or fees. Steele Creek suspended new share sales indefinitely at the same time.
NAV was $8.48 per share as of June 30, down from $8.65 on Dec. 31, 2025, and net assets totaled $49.8 million. In its most recent quarterly tender offer, which expired July 1, the fund offered to buy back up to 606,434 shares. Shareholders tendered 133,226 shares.
On Aug. 17, the board declared a distribution of $0.1287 per share, payable Oct. 15 to shareholders of record on Aug. 19.
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