Gladstone greenshoe exercised, lifts 7.125% preferreds by $3.4 million

By Marisa Wong

Madison, Wis., Nov. 17 - Gladstone Capital Corp. announced that the underwriters of its recent offering of 7.125% series 2016 term preferred stock partially exercised their over-allotment option for an additional 139,882 preferreds. The net proceeds from the additional preferreds totaled $3.4 million.

The total liquidation preference of preferreds priced is now $38.5 million.

Janney Montgomery Scott LLC was the bookrunner and lead manager for the offering. BB&T Capital Markets, J.J.B. Hilliard, W.L. Lyons, LLC, Wunderlich Securities, Inc., Ladenburg Thalmann & Co. Inc. and Boenning & Scattergood, Inc. were the co-managers.

Gladstone initially priced 1.4 million of the preferreds at $25 each for gross proceeds of $35 million. The original offering settled on Nov. 4.

As previously reported, the preferreds mature Dec. 31, 2016 but are callable after Dec. 31, 2012 at par plus a premium and accrued dividends.

Additionally, the company can elect to redeem a portion of the preferreds should its asset coverage ratio fall below 200%.

Dividends are payable monthly, beginning Dec. 31.

The preferreds are listed on the New York Stock Exchange under the symbol "GLADPrA."

Proceeds from the underwritten public offering will be used to pay down debt, including a portion of the outstanding balance on the company's credit line.

Gladstone Capital is a McLean, Va.-based specialty finance company.

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