Patriot Capital Takes 8 First Round Bids, None From Fifth Street
In April, small-market lender Patriot Capital Funding announced it was considering strategic alternatives. What the struggling BDC (business development corp.) didn't say was that the company had already shopped itself widely and was kicking off a full auction. Last week, Patriot took first-round bids from eight parties, according to two lending sources who asked not to be named. One source said the bidding pool included two or three fellow BDCs and one private equity firm, adding that bids ranged from $2 per share to "full valuations" of $3 per share. As of 2pm this afternoon, Patriot Capital was trading at $1.91 per share, or a $40 million market cap. A year ago, the BDC's shares traded at more than $9 per share, but in recent months, Patriot Capital has met difficulty. In April one of the company's credit facilities was terminated because the value of assets provided as collateral had dropped.
