Prospect Capital, Goes Prospecting For Capital (PSEC)

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Prospect Capital Corporation (NASDAQ: PSEC) has announced a public offering of 3 million shares of common stock, and Prospect will grant the underwriters a 30-day option to purchase up to an additional 450,000 shares of its common stock to cover over-allotments.

The private equity and mezzanine financing company expects to use the net proceeds from this offering to repay outstanding debt, to fund investments in portfolio companies, and for general corporate purposes.

Citi and Wachovia are the lead underwriters, and Oppenheimer, and RBC Capital Markets are listed the co-managers of this offering.

Interestingly enough, Prospect’s market cap before any extra dilution or share issuance is $377 million.  If this priced at today’s closing levels this would raise an additional $47+ million before fees.

This is a fairly thin volume private equity firm stock with only about 165,000 shares trading hands on most days.  Without the over-allotment, that looks close to 20-days worth of trading volume.

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Jon C. Ogg
May 27, 2008