Stellus Capital Investment Corporation Announces Pricing of Public Offering of 7.25% Notes Due 2030
HOUSTON, March 25, 2025 – Stellus Capital Investment Corporation (NYSE: SCM) (“Stellus” or “the Company”), a leading middle-market investment firm, announced today the pricing of a public offering of $75 million aggregate principal amount of 7.25% notes due 2030 (the “Notes”).
Terms of the Notes
The Notes will mature on April 1, 2030. Stellus has the option to redeem the Notes in whole or in part at any time or from time to time prior to maturity at par plus a “make-whole” premium, if applicable.
Use of Proceeds
Stellus intends to use the net proceeds from the offering for general corporate purposes, which may include investments in new portfolio companies, repayment of outstanding indebtedness, and working capital and other operational needs.
Impact on Individual Investors
For individual investors, the pricing of Stellus’ notes offering may indicate the company’s confidence in its financial position and future growth prospects. As with any investment, there are risks involved, including the potential for interest rate fluctuations and credit risk. Investors should carefully consider their investment objectives and consult with their financial advisors before making any investment decisions.
- Interest rate risk: The value of fixed-income investments like Stellus’ notes can be adversely affected by rising interest rates, as newly issued bonds with higher yields may be more attractive to investors.
- Credit risk: There is a risk that Stellus may default on its debt obligations, which could result in financial losses for investors.
Impact on the World
The pricing of Stellus’ notes offering is just one data point in the larger context of the global economy. However, it may be indicative of broader trends in the credit markets, such as investor appetite for fixed-income securities and the direction of interest rates.
- Interest rates: If the Federal Reserve raises interest rates in response to rising inflation or other economic concerns, it could make it more expensive for companies to issue new debt, potentially slowing down economic growth.
- Credit markets: A strong demand for corporate debt issuance could signal that investors are optimistic about the economic outlook and willing to take on more risk.
Conclusion
Stellus Capital Investment Corporation’s pricing of a $75 million public offering of 7.25% notes due 2030 is a significant development for the company and the broader credit markets. While the offering may provide Stellus with the capital it needs to pursue its growth strategy, it also carries risks for individual investors. As always, investors should carefully consider their investment objectives and consult with their financial advisors before making any investment decisions.
Meanwhile, the pricing of Stellus’ notes may be a bellwether for broader trends in the credit markets, including investor appetite for fixed-income securities and the direction of interest rates. Stay tuned for further developments in this space.
