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Sierra Income Corporation Has Raised $922 Million

July 9, 2018

Sierra Income Corporation Has Raised $922 Million

July 9, 2018 | James Sprow | Blue Vault

As of July 5, 2018, the Company has raised a total of approximately $922 million, which includes the issuance of 1,108,033 shares of common stock to SIC Advisors LLC in exchange for gross proceeds of $10 million immediately following the effectiveness of its registration statement. As of July 5, 2018, the BDC has combined proceeds, as well as leverage through its revolving credit facilities with ING Capital LLC and JP Morgan Chase, which it has used to invest $1,011 million in principal across 107 transactions.

On July 2, 2018, the Company’s board of directors determined to terminate the offering effective as of July 31, 2018. Completed subscription agreements must be received in good order by Tuesday, July 31, 2018, in order to be accepted into the Company by the last admit date of Friday, August 3, 2018.

Sierra Income Corporation was incorporated on June 13, 2011, and formally commenced operations on April 17, 2012. The Company is an externally managed, non-diversified closed-end management investment company that has elected to be treated as a business development company (“BDC”) under the Investment Company Act of 1940. The Company is externally managed by SIC Advisors LLC. SIC Advisors is a majority owned subsidiary of Medley LLC, which is controlled by Medley Management Inc., a publicly traded asset management firm (NYSE: MDLY), which in turn is controlled by Medley Group LLC, an entity wholly-owned by the senior professionals of Medley LLC.

The Company’s investment objective is to generate current income, and to a lesser extent, long-term capital appreciation. The Company intends to meet its investment objective by investing primarily in the debt of privately owned U.S. companies with a focus on senior secured debt, second lien debt and, to a lesser extent, subordinated debt. As of March 31, 2018, the Company’s portfolio had a fair value of $1.042 billion and consisted 51.4% of senior secured first lien term loans, 21.5% senior secured second lien term loans, 7.2% subordinated notes, 8.0% in a JV with Sierra Senior Loan Strategy JV I LLC, 4.1% in senior secured first lien notes, and 7.7% in equity warrants.

The BDC had quarterly distributions of $0.16 per share and a net asset value of $7.49 per share for Q1 2018. Based upon the public offering price of $8.15 per share, the distribution yield was 7.85% annualized. According to Blue Vault’s Q1 2018 BDC Review, the BDC had an annualized 13.25% yield on equity and 9.25% yield on portfolio.

Sources:  SEC, Blue Vault

 

Learn more about Medley Management Inc. on the Blue Vault Sponsor Focus page

 

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Gil Armour, CFP
February 3, 2016

I have been using Blue Vault Partners for the past five years.  I have found them to be a valuable, unbiased resource when it comes to evaluating and comparing non-traded REITs.  The reports help me analyze which sponsors are doing a responsible job of managing their offerings.  This allows me to limit my REIT recommendations to only the most competitive products, and then track those REITs throughout their life cycle.