CSWC (Capital Southwest Corporation) Prices $350 Million of 6.750% Notes Due 2031
View the CSWC Dividend Stock Profile
Capital Southwest Corporation priced ﹩350 million of 6.750% unsecured notes due September 15, 2031, on September 10, 2026.
Offering terms
The notes were priced at 98.985% of principal for a 6.994% yield to maturity. Interest is payable twice a year, beginning March 15, 2027, and the offering is expected to close September 15, subject to customary conditions.
CSWC plans to use the proceeds to repay part of its senior secured revolving credit facility. The final prospectus reported ﹩351 million outstanding on that facility as of September 9. The new coupon implies about ﹩23.6 million of annual cash interest before fees and issuance costs.
Why it matters
The transaction can replace short-term secured borrowing with longer-dated fixed-rate unsecured debt and restore revolving capacity for future investments. It also locks in a meaningful funding cost through 2031. The effect on net investment income will depend on the revolver cost being replaced and the returns earned on later deployments.
Earnings remain the primary signal for dividend support. Shareholders should watch the completed debt repayment, post-closing leverage, funding expense and whether new investments earn enough to offset the added fixed interest burden.
Sources
This article is general information, not personalized investment advice. Fly High Investing may hold securities discussed in this article.