Midcap Financial (MFIC) Merger Gets CEF Stockholders' Approval
Midcap Financial Investment Corp. MFIC and Apollo Senior Floating Rate Fund Inc. and Apollo Tactical Income Fund Inc.’s (collectively referred to as “CEF”) proposed merger received approval from CEF Stockholders recently. The approval was granted during the special stockholders meeting on Jun 21, 2024.
Roughly 53% of AFT and AIF common shares outstanding voted in favor of the merger proposal. This, thus, fulfilled the stockholder approval requirements. The final voting results remain subject to certification by the inspector of election of AFT and AIF special meetings of stockholders.
On May 28, 2024, MFIC’s stockholders approved the merger in a special meeting. The merger is expected to be closed in late July, subject to fulfillment of customary closing conditions.
Upon the completion of the merger, the combined entity will continue to trade on the Nasdaq Global Select Market under the ticker symbol “MIFC.”
Stockholders of CEF will receive MFIC shares with a net asset value (“NAV”) equivalent to the NAV of their current shares in each respective CEF, with the applicable NAVs to be determined before the closing of the merger. The NAVs per share for the CEFs will be adjusted to account for any previously undistributed net investment income and capital gains before closing.
The deal, announced in November 2023, is expected to be accretive to Midcap Financial’s return on equity and net investment income per share. It will result in better stock liquidity and operational synergies. Post completion of the deal, a special dividend of 20 cents per share will be paid by the company to shareholders. This strategic move is in alignment with MFIC’s growth strategy.
Over the past year, shares of the company have gained 10.3% against the industry’s decline of 1.7%.
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Midcap Financial currently carries a Zacks Rank #3 (Hold ). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.
Other Financial Services Firms Taking Similar Steps
Earlier this month, AssetMark Financial Holdings Inc.’s AMK wholly-owned subsidiary AssetMark Inc. entered into a strategic coalition with Morningstar Wealth. The transaction, approved by the board of directors of both companies, is expected to be closed in the second half of 2024, subject to regulatory approvals.
ANK will acquire roughly $12 billion in assets from Morningstar Wealth Turnkey Asset Management Platform ("TAMP") as part of the alliance. AssetMark’s platform, which offers top-tier service, advisor technology, business consulting, and a diligently selected group of investment strategists, will be accessible to financial advisors and clients on Morningstar Wealth’s TAMP.
Similarly, M&T Bank’s MTB wholly-owned subsidiary — M&T Realty Capital Corporation — has collaborated with Blackstone Mortgage Trust Inc. BXMT to enable BXMT borrowers’ expanded access to multifamily agency financing. This will be initiated through M&T Realty Capital’s Fannie Mae DUS and Freddie Mac Optigo lending platforms. The partnership will allow BXMT to provide conventional and reasonable multifamily loans.
This deal strengthens M&T Bank's partnership with BXMT and reflects the company's current commercial real estate innovation strategy of expanding its client base and increasing its national multifamily lending platform.
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