NEW YORK--(BUSINESS WIRE)--Dec. 17, 2012--
Solar Capital Ltd. (NASDAQ:SLRC) (“Solar Capital”) today announced that
it has entered into a definitive agreement, dated December 17, 2012,
with SSP Energy Ltd., Quartz Managers LLC and Quantum Strategic Partners
Ltd. to acquire Crystal Capital Financial Holdings LLC (“Crystal
Financial”), a commercial finance company focused on providing
asset-based and other secured financing solutions. Crystal Financial’s
management team, including while at prior businesses, has underwritten
and closed more than $20 billion of transactions for its clients since
Solar Capital expects to invest approximately $275 million to effect the
acquisition. The current management team of Crystal Financial has
committed to lead Crystal Financial going forward and will also make a
meaningful investment as part of the transaction. Solar Capital expects
that its acquisition of Crystal Financial will be immediately accretive
to net investment income.
Crystal Financial currently oversees a directly originated and
underwritten, diversified portfolio of 23 loans having a total par value
of approximately $400 million at November 30, 2012. Solar Capital
believes that Crystal Financial’s business of assisting issuers with
unique financing needs offers the potential for attractive returns
irrespective of economic or debt capital market conditions.
Solar Capital expects to fund its investment in Crystal Financial with
available liquidity, including borrowings under Solar Capital’s existing
credit facilities. Solar Capital’s investment, together with Crystal
Financial’s current available liquidity under its $275 million credit
facility, provides Crystal Financial with significant growth capital.
Crystal Financial’s credit facility is expected to have approximately
$145 million of borrowings outstanding at closing and is non-recourse to
Post-closing, Solar Capital expects Crystal Financial to be treated as a
pass-through entity for tax purposes and to distribute a substantial
portion of its current earnings to Solar Capital on a quarterly basis.
Solar Capital expects its investment in Crystal Financial to generate a
cash yield consistent with other assets in its portfolio.
“We believe that Crystal Financial offers a compelling opportunity for
us to invest in an established business whose management team has an
exceptional track record,” said Michael Gross, Chairman and CEO of Solar
Capital. “We have known the Crystal Financial management team over the
course of our careers and have confidence in their long-term strategy
for prudently growing their business.”
“We believe that this portfolio company investment offers a highly
attractive and diversified senior secured risk-return profile for Solar
Capital,” said Bruce Spohler, Chief Operating Officer of Solar Capital.
“We expect that our Crystal Financial investment will move us toward our
target debt-to-equity ratio while increasing Solar Capital’s net
“We are excited about our new relationship with Solar Capital and the
growth opportunities it presents,” said Ward Mooney, Chief Executive
Officer of Crystal Financial LLC. “Solar Capital’s stable, long-term
funding will enhance our ability to provide innovative financing
solutions to our clients. The continued independence of our business
operations will allow us to remain committed to the core values that
have defined our long-term, collaborative partnerships with clients.”
The acquisition is subject to customary closing conditions, including
the expiration of the applicable waiting period under the Hart Scott
Rodino Act, and is expected to close prior to year end. Deutsche Bank
Securities Inc. acted as financial advisor to Crystal Financial for the
1 Past results, either on the part of Solar Capital or
Crystal Financial, are not necessarily indicative of future performance
or earnings levels at either entity, and results may vary substantially
from period to period as a result of a number of factors. See
“Forward-Looking Statements” below.
ABOUT CRYSTAL FINANCIAL LLC
Crystal Financial LLC is a commercial finance company that primarily
originates and underwrites asset-based and other secured custom
solutions for clients that operate across diverse industries. Crystal
Financial is headquartered in Boston, Massachusetts, with satellite
offices in Chicago, Atlanta, and Los Angeles. The firm’s Chief Executive
Officer, Ward Mooney, and Chief Credit Officer, Michael Pizette, each
have over 20 years of specialty lending experience.
ABOUT SOLAR CAPITAL LTD.
Solar Capital Ltd. is a closed-end investment company that has elected
to be treated as a business development company under the Investment
Company Act of 1940. Solar Capital invests primarily in leveraged,
middle market companies in the form of senior secured loans, mezzanine
loans, and equity securities.
Statements included herein may constitute “forward-looking statements,”
which relate to future events or our future performance or financial
condition. These statements are not guarantees of future performance,
condition or results and involve a number of risks and uncertainties.
Solar Capital and Crystal Financial operate in a very competitive and
rapidly changing environment, in which new risks emerge from time to
time. Some of the factors that could cause actual results to differ
materially from the forward-looking statements contained herein include,
without limitation: (i) Crystal Financial’s ability to maintain its
historical financial performance, (ii) departures of key members of the
Crystal Financial management team following closing, and (iii) material
adverse changes to the portfolio of assets held by Crystal Financial as
of or following the closing. For a more detailed discussion of factors
related to Solar Capital’s business, see the information under the
captions "Risk Factors" in our most recent annual report on Form 10-K
and our subsequent quarterly reports on Form 10-Q filed with the
Securities and Exchange Commission. Given these risks and uncertainties,
you should not place undue reliance on these forward-looking statements.
Solar Capital undertakes no duty to update any forward-looking
statements made herein.
Source: Solar Capital Ltd.
Solar Capital Ltd.
Richard Pivirotto, 212-994-8543