FS KKR Capital Corp. (FSK) Closes Merger; Announces $100M Share Repurchase Program

June 16, 2021 4:16 PM EDT

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FS/KKR Advisor, LLC (FS/KKR), a partnership between FS Investments and KKR Credit Advisors (US), today announced the completion of the merger between FS KKR Capital Corp. (NYSE: FSK) and FS KKR Capital Corp. II (NYSE: FSKR). The combined company will operate as FS KKR Capital Corp. and continue to trade on the New York Stock Exchange under the ticker "FSK."

Michael Forman, Chairman and Chief Executive Officer of FSK, commented, "We are excited to complete this merger and operate a single BDC with the market reach and balance sheet strength to be a leader in private credit markets. This combination represents an important milestone for our franchise in our plan to drive enhanced value to our investors."

Based on the merger exchange ratio, FSKR shareholders are receiving 0.9498 FSK shares for each share of FSKR held. The exchange ratio was determined based on the closing net asset value (NAV) per share of $26.77 and $25.42 for FSK and FSKR, respectively as of June 14, 2021, and ensures that the NAV of shares investors will own in FSK will be equal to the NAV of the shares they held in FSKR. As part of the closing, FSK will not be paying cash in lieu of fractional shares.

Dan Pietrzak, Chief Investment Officer and Co-President of FSK, said, "The combination creates a premier BDC lending franchise with approximately $15 billion in assets. With our portfolio diversification, enhanced access to capital markets, and over $3 billion of available investment capacity, we believe we are well-positioned as a leading lender to upper middle market borrowers."

Share Repurchase Program

In addition, as previously announced, in connection with the closing of the merger, the board of directors of FSK (the "Board") has authorized a share repurchase program. Under the program, FSK may repurchase up to $100 million in the aggregate of its outstanding common stock in the open market at prices below the current net asset value per share.

The timing, manner, price and amount of any share repurchases will be determined by FSK, based upon the evaluation of economic and market conditions, FSK's stock price, applicable legal and regulatory requirements and other factors. The program will be in effect for one year from its effective date, unless extended, or until the aggregate repurchase amount that has been approved by the Board has been expended. The program may be suspended, extended, modified or discontinued at any time.



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