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NewStar Financial (NEWS) Reports In-Line Q3 EPS; Forms 'Strategic' Relationship with GSO Capital

November 5, 2014 7:29 AM EST

NewStar Financial (NASDAQ: NEWS) reported Q3 EPS of $0.10, in-line with the analyst estimate of $0.10. Revenue for the quarter came in at $0 versus the consensus estimate of $21.3 million.

In a separate press release issued today, NewStar also announced the formation of a strategic relationship with GSO Capital ("GSO"), the credit division of Blackstone (NYSE: BX), and Franklin Square Capital Partners ("Franklin Square"), the largest manager of business development companies, to help expand the Company's lending and asset management platforms. The relationship includes a long-term strategic investment by funds managed by Franklin Square and sub-advised by GSO of $300 million in 8.25% subordinated notes due 2024 and warrants exercisable for 12 million shares of NewStar common stock at an exercise price of $12.62, which represents a premium to the 30-day volume weighted average price ("VWAP") of NewStar common stock and equals the Company's book value per share as of June 30, 2014. The transaction is expected to be accretive to the Company's book value per share by an amount equal to the fair value of the warrants issued at closing divided by the then outstanding number of shares.

For earnings history and earnings-related data on NewStar Financial (NEWS) click here.



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