Sound Point Meridian Capital, Inc. Announces Closing of Initial Public Offering

Rhea-AI Summary

Sound Point Meridian Capital announced the closing of its IPO, issuing 4,000,000 shares at $20.00 per share, resulting in net proceeds of approximately $79.7 million. The company, trading under the ticker 'SPMC' on NYSE since June 14, 2024, has also given underwriters a 30-day option to buy an additional 600,000 shares.

The proceeds will be used for acquiring investments and general working capital. Post-IPO, the company's net asset value stands at $400.1 million. The IPO was managed by Oppenheimer, B. Riley Securities, Janney Montgomery Scott, and Piper Sandler, with Clear Street and Wedbush Securities as co-managers.

Positive

• Closed IPO with net proceeds of approximately $79.7 million.
• Issued 4,000,000 shares at $20.00 per share.
• Underwriters have a 30-day option to purchase up to 600,000 additional shares.
• Net asset value post-IPO is $400.1 million.
• Shares began trading on NYSE under the symbol 'SPMC'.
• Proceeds will be used to acquire investments and for general working capital.

Negative

• Possible shareholder dilution with the option for underwriters to purchase additional shares.
• Organizational expenses and sales load paid by the Company's investment adviser may affect net proceeds.

Insights

Financial Analyst

The successful completion of Sound Point Meridian Capital's IPO, raising approximately $79.7 million, is a significant milestone. This capital infusion enhances the company's financial flexibility for pursuing its investment objectives and strategies. It's worth noting the underwriters' 30-day option to purchase an additional 600,000 shares, which could further increase funds raised.

The use of proceeds for acquiring investments and general working capital signals a strategic focus on growth and operational stability. The stated net asset value of $400.1 million post-IPO indicates a strong financial base, which could instill confidence in potential investors.

From a market perspective, the involvement of reputable underwriters like Oppenheimer & Co. and B. Riley Securities underscores the IPO's credibility. The stock's trading under the symbol SPMC on NYSE also provides liquidity and market visibility. Investors should, however, be mindful of the risks and expenses associated with the company as highlighted in the final prospectus.

Market Research Analyst

The entry of Sound Point Meridian Capital into the public market via IPO is a noteworthy development, particularly for those tracking new investment funds. The public offering price of $20.00 per share reflects a confident valuation, potentially indicating market optimism about the company's future performance.

The strategic use of IPO proceeds for investment acquisitions and working capital points towards an aggressive growth strategy. This can be seen as a positive signal to retail investors who prioritize growth potential. However, the broader market conditions and investor sentiment will play important roles in determining the stock's performance post-IPO.

Additionally, the involvement of joint book-running managers like Piper Sandler and co-managers such as Wedbush Securities suggests strong institutional support, which can further bolster investor confidence. Retail investors should remain vigilant about market trends and the company's adherence to its stated investment objectives.

NEW YORK--(BUSINESS WIRE)-- Sound Point Meridian Capital, Inc. (NYSE: SPMC) (the “Company”) today announced the closing of its previously announced initial public offering of 4,000,000 shares of common stock at a public offering price of $20.00 per share, for net proceeds to the Company of approximately $79.7 million after payment of certain offering expenses. In addition, the Company has granted the underwriters a 30-day option to purchase up to an additional 600,000 shares of common stock to cover over-allotments, if any. Sound Point Meridian Management Company, LLC, the Company’s investment adviser, or its affiliates will pay the full amount of the sales load in connection with this initial public offering and all of the Company’s organizational expenses.

The Company intends to use the proceeds from the offering of its common stock to acquire investments in accordance with its investment objectives and strategies and for general working capital purposes. On a pro forma basis, after giving effect to the sale of 4,000,000 shares and the payment of certain offering expenses as described above, and assuming no exercise of the underwriters’ option to purchase additional shares, the Company’s net asset value would be $400.1 million.

Shares of the Company’s common stock began trading on the New York Stock Exchange under the symbol “SPMC” on June 14, 2024.

Oppenheimer & Co. Inc., B. Riley Securities, Inc., Janney Montgomery Scott LLC and Piper Sandler & Co. acted as joint book-running managers for the offering. Clear Street LLC and Wedbush Securities Inc. acted as co-managers for the offering.

Investors should consider the Company’s investment objectives, risks, charges and expenses carefully before investing. The final prospectus, which has been filed with the Securities and Exchange Commission (“SEC”), contains this and other information about the Company and should be read carefully before investing. The final prospectus and this press release are not offers to sell these securities and are not soliciting an offer to buy these securities in any state where such offer or sale is not permitted.

A registration statement relating to these securities is on file with and has been declared effective by the SEC. Copies of the final prospectus may be obtained by writing Oppenheimer & Co. Inc., Attn: Syndicate Prospectus Department, 85 Broad Street, 26^th Floor, New York, NY 10004, by calling (212) 667-8055, or by sending an e-mail to EquityProspectus@opco.com. Copies may also be obtained by visiting EDGAR on the SEC’s website at www.sec.gov.

ABOUT THE COMPANY

The Company is an externally managed, non-diversified closed-end management investment company. The Company’s investment objective is to generate high current income, with a secondary objective to generate capital appreciation, by investing primarily in third-party collateralized loan obligation (“CLO”) equity and mezzanine tranches of predominately U.S. dollar-denominated CLOs backed by corporate leveraged loans issued primarily to U.S. obligors. The Company is externally managed and advised by Sound Point Meridian Management Company, LLC. The Company’s public filings are available free of charge by writing to the Company at Sound Point Meridian Capital, Inc., 375 Park Avenue, 34^th Floor, New York, NY 10152, Attention: Investor Relations, or by telephone at (833) 217-6665.

ABOUT SOUND POINT MERIDIAN MANAGEMENT COMPANY

Sound Point Meridian Management Company, LLC (the “Adviser”) is the Company’s external adviser and is majority owned by Sound Point Capital Management, LP (“Sound Point Capital Management”), a registered investment adviser. The Adviser’s CLO Investment team is comprised of Stephen J. Ketchum, Ujjaval Desai, Matt Seifert, and Dylan Leahy.

ABOUT SOUND POINT CAPITAL MANAGEMENT

Sound Point Capital Management is an alternative asset management firm founded in 2008 with particular expertise in credit strategies. Based in New York, with offices in London, Connecticut, Florida and California, the firm manages money on behalf of institutional investors, including top-tier pensions, foundations, insurance companies, wealth management firms and family offices. Sound Point Capital Management's strategies span the spectrum of liquid and illiquid credit alternatives and include funds and managed accounts focused on leveraged loans, special situations, distressed debt, structured credit, direct lending and commercial real estate. Sound Point Capital Management currently manages $45+ billion of assets and was founded by Stephen J. Ketchum, who is the controlling shareholder. Five principals of Stone Point Capital LLC, as well as Blue Owl GP Stakes, a division of Blue Owl Capital Inc. (NYSE: OWL), and Assured Guaranty Ltd, through one or more subsidiaries, are strategic investors in Sound Point Capital Management. For more information, please visit Sound Point Capital Management's website at www.soundpointcap.com.

FORWARD-LOOKING STATEMENTS

This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described in the prospectus and the Company’s other filings with the SEC. The Company undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release.

NOT FDIC INSURED • NO BANK GUARANTEE • MAY LOSE VALUE

View source version on businesswire.com: https://www.businesswire.com/news/home/20240617546111/en/

Investor Relations:

Garrett Edson – ICR; Julie Smith – Sound Point Capital

(833) 217-6665

ir@soundpointmeridiancap.com

Source: Sound Point Meridian Capital, Inc.

FAQ

What is the ticker symbol for Sound Point Meridian Capital?

The ticker symbol for Sound Point Meridian Capital is 'SPMC'.

How many shares did Sound Point Meridian Capital issue in its IPO?

Sound Point Meridian Capital issued 4,000,000 shares in its IPO.

What was the IPO price for Sound Point Meridian Capital's shares?

The IPO price for Sound Point Meridian Capital's shares was $20.00 per share.

When did Sound Point Meridian Capital's shares begin trading on NYSE?

Sound Point Meridian Capital's shares began trading on NYSE on June 14, 2024.

How much did Sound Point Meridian Capital raise from its IPO?

Sound Point Meridian Capital raised net proceeds of approximately $79.7 million from its IPO.

What is the net asset value of Sound Point Meridian Capital post-IPO?

The net asset value of Sound Point Meridian Capital post-IPO is $400.1 million.