At 9/30/2017 WHF had 31 portfolio companies, of which 25 were performing and 6 under-performing. No loan was on non-accrual. There were 38 different positions. The total portfolio had a fair market value of $435mn. The loan portfolio consisted primarily of senior secured loans to lower mid-market borrowers, which were variable-rate investments. The portfolio had an average investment size of $11.5 million based on fair value, with the largest investment being $26 million. [Source: Conference Call]
Currently, the 6 Watch List names are Outcome Health, Grupo Hima San Pablo, Caelus Energy, Oasis Legal Finance, Aretec Group and the NMFC Senior Loan Program I, LLC. Our major concerns are Outcome Health (which just settled a major lawsuit with its investors and is hunting for a new CEO); Oasis Legal Finance (also legal issues including a recent los) and Grupo Hima San Pablo (Puerto Rico hospital chain). Aretec Group is equity and appears to be improving following a restructuring, the NMFC Senior Loan is dropping modestly in value and Caelus may be benefiting from higher oil prices.
The BDC Credit Reporter tracks all 31 companies daily.
Mills Fleet Farm has appointed Michael Schwindle evp/chief financial officer.
WHF: Sears Holdings Corp. says it's laying off 220 workers primarily at its headquarters in Hoffman Estates, Illinois as it struggles to turn around its ailing business.
WHF: Matthew Koncz has been promoted internally to become President of Fluent, LLC's (a subsidiary of public company Cogint, Inc) Performance Media Group.
WHF: Outcome Health has settled the allegations of fraud that came from its investors, but with an internal investigation still underway and some of the fallout from legal troubles unresolved, challenges r
WHF: This is good news for the Company and for its lenders. We learn from the article that some debt has been paid down and the infusion of new equity capital by the founders and a group of investors led by Goldman Sachs solidifies the Company's prospects. One of the remaining pieces of the puzzle is identifying a new CEO. A COO has been appointed. Both the founders get kicked upstairs.
A-list investors placed a big bet on Outcome Health despite multiple warning signs, a Wall Street Journal examination shows, illustrating how even the savviest investors can gloss over potential issue
“Goldman Sachs as lead investor bet $100M on Outcome Health and was in charge of due diligence. A look at other top investors now suing for fraud (Emerson Collective is the VC firm of Laurene Powell J
Goldman Sachs’ due diligence did not include watching publicly-available Vimeo interviews of the guy it was investing nine figures with.
Synopsis: Absent guidance from Florida regulators, a man is taking it upon himself to attempt to show that companies that finance lawsuits charge interest rates in excess of state law.
WHF: With the sale of Katun Corporation to a Taiwanese buyer, the only BDC with exposure is WhiteHorse Finance (WHF), which has $4.4mn at cost and carried close to par in exposure at 9/30/2017, according to Advantage Data. The WHF exposure is in the publicly traded Second Lien Notes, which pay a high rate of LIBOR + 1125 bps. We expect the debt will be repaid and WHF will lose a high yielding borrower.
Another setback for Outcome Health amidst concern that the beleaguered company may continue to slide downwards.
Synopsis: Years before investors flocked to startup, lawsuit put a spotlight on misleading statements from Outcome Health sales reps.
Two companies that made settlement loans up to $1,500 to lawsuit plaintiffs were charging predatory interest rates, AG Cynthia Coffman said.