MSC Income Fund BDC Takes Steps Toward Publicly Listing Common Stock
MSC Income Fund Inc., a non-traded business development company formerly known as HMS Income Fund, recently filed a preliminary proxy statement with the U.S. Securities and Exchange Commission, outlining a series of proposals to eventually publicly list its common stock on a national securities exchange. The board is asking stockholders to vote on the proposals at a future special meeting.
The proposals, typical of a company seeking to prepare itself for listing, include amending the company charter to limit the transferability of outstanding shares in the 365 days after listing; conforming provisions of the charter to more closely resemble the charters of other BDCs whose securities are listed and publicly traded; amending its advisory and administrative services agreement to reduce the annual base management fees payable by the company to the adviser, and reduce and reset the incentive fee on capital gains payable by the company to the adviser; and authorizing flexibility for the company to offer and sell shares at a price below net asset value per share; among other amendments.
Launched in 2012, the fund was previously advised by a Hines affiliate and sub-advised by an affiliate of Main Street Capital Corporation, a publicly traded BDC. In fall 2020, shareholders approved an advisory agreement to turn over sole advisement to Main Street. Now externally managed by a wholly owned subsidiary of Main Street, the fund specializes in providing long-term debt and equity capital to lower middle-market and middle-market companies.
Earlier this month, MSC’s board appointed Cory E. Gilbert to serve as the company’s chief financial officer and treasurer, succeeding Jesse E. Morris, and moving on from his role as vice president and chief accounting officer. Morris will continue to serve as executive vice president, chief operating officer, and managing director.
MSC Income Fund is a principal investment fund that provides debt and equity financing solutions primarily to private U.S. companies. Its objective is to generate both current income and capital appreciation for its investors, doing so through a strategy of making debt investments in middle-market companies and debt and equity investments in lower middle-market companies.
The fund’s portfolio investments are typically made to support management buyouts, recapitalizations, growth financings, refinancings and acquisitions of companies that operate in diverse industry sectors.
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