TPG Specialty Lending prices IPO at $16 per share: Reuters

TPG Specialty Lending (TSL), private equity firm TPG Capital LP’s business development company, said it priced its initial public offering at $16 per share, the low end of its planned range.

The company, launched by TPG in 2011, sold 7 million shares in the offering, raising $112 million, TSL said in a statement on Thursday.

TSL, which first filed to go public in February, had expected to sell the shares at between $16 and $17 each.

Since its launch in 2011, TSL has raised $1.5 billion from investors, including a $117.1 million commitment from its parent. It will have an equity valuation of about $830 million at the IPO price.

Business development companies (BDCs) are pools of capital that invest in different types of debt of small and middle-market companies. BDCs often trade on public markets and pay out at least 90 percent of their annual profits as dividends to avoid corporate taxation under provisions passed by Congress in 1980.

San Francisco-based TSL plans to use proceeds from the offering to pay down debt and invest in portfolio companies.

Its shares are slated to begin trading on Friday on the New York Stock Exchange under the symbol “TSLX”.

The company has reported gross internal rate of return of 17.6 percent on investments it has exited from inception through the end of 2013. Net investment income for 2013 more than doubled from 2012 to $57.5 million.

JP Morgan, Bank of America Merrill Lynch and Goldman Sachs & Co were lead underwriters to the offering.

(Reporting by Aman Shah in Bangalore; Editing by Lisa Shumaker)

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