NEW YORK, NY--(Marketwire - April 5, 2010) - Prospect Capital Corporation (
Founded in 1974, Shearer's is the largest producer of kettle cooked potato chips in the United States. The kettle-style chip segment is the fastest growing category in the potato chip market. Shearer's also produces traditional potato chips, tortilla chips, cheese curls, and other snack products. The Company serves a blue-chip list of co-pack, branded, private label, and food service customers, including some of the best known branded food companies in the industry. Shearer's has multiple manufacturing facilities, giving the Company a national footprint. Robert Shearer, the Company's Chief Executive Officer and the former Chairman of the Board of Directors for the Snack Food Association, has played a leadership role in the industry for decades. Shearer's has been majority owned since 2008 by Mistral Equity Partners, a private equity firm based in New York.
Prospect's secured junior debt, along with first lien debt from a lender syndicate, is being utilized to support the acquisition by Shearer's of Snack Alliance, a manufacturer and distributor of branded and private label snack food products with many products in the "better-for-you" category. The Snack Alliance acquisition will enable Shearer's to offer a wider array of products to its existing customers. Prospect's new debt investment replaces Prospect's prior $18 million debt investment in Shearer's. In conjunction with the debt investment, Prospect also made an additional equity co-investment in Shearer's to support the acquisition.
"The Shearer's transaction represents another successful example of our continued growth in our sponsor finance business, where we are generating significant transaction volume from private equity groups because of our flexible financing structures," said David Moszer, a senior professional with Prospect Capital Management.
ABOUT PROSPECT CAPITAL CORPORATION
Prospect Capital Corporation (www.prospectstreet.com) is a closed-end investment company that lends to and invests in private and microcap public businesses. Our investment objective is to generate both current income and long-term capital appreciation through debt and equity investments.
We have elected to be treated as a business development company under the Investment Company Act of 1940 ("1940 Act"). We are required to comply with a series of regulatory requirements under the 1940 Act as well as applicable NASDAQ, federal and state rules and regulations. We have elected to be treated as a regulated investment company under the Internal Revenue Code of 1986. Failure to comply with any of the laws and regulations that apply to us could have an adverse effect on us and our shareholders.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, whose safe harbor for forward-looking statements does not apply to business development companies. Any such statements, other than statements of historical fact, are highly likely to be affected by other unknowable future events and conditions, including elements of the future that are or are not under our control, and that we may or may not have considered; accordingly, such statements cannot be guarantees or assurances of any aspect of future performance. Actual developments and results are highly likely to vary materially from these estimates and projections of the future. Such statements speak only as of the time when made, and we undertake no obligation to update any such statement now or in the future.