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Vertical Capital Income Fund (NYSE: VCIF) is a closed-end fund dedicated to generating monthly income through strategic investments. The Fund primarily invests in performing non-agency residential whole loans secured by real estate. Its secondary strategy aims at total return by acquiring performing residential loans at a discount to the unpaid principal balance, realizing capital gains as these loans are paid off before maturity.
Recently, the Fund has engaged in a significant transaction with an affiliate of global investment firm Carlyle (NASDAQ: CG). This transaction involves the sale of a major portion of its investment portfolio to satisfy conditions for closing a shareholder-approved deal. Consequently, the Fund's net asset value per share has adjusted from $9.96 to $8.27. Additionally, the Fund has terminated its Managed Distribution Plan and suspended regular distributions, anticipating new dividends post-transaction closure.
Upon successful closing of the transaction, Carlyle Global Credit Investment Management L.L.C. (CGCIM) will become the Fund’s new investment adviser. The Fund’s focus will shift to investing in equity and debt tranches of collateralized loan obligations (CLOs) to enhance shareholder value.
As part of the transaction agreement, CGCIM will make a special one-time payment to the Fund’s shareholders, amounting to approximately $0.96 per share, upon closing. Additionally, they will make a $40 million equity investment in the Fund through multiple transactions. Carlyle is expected to own around 35% of the Fund upon completion of these transactions.
The transition is backed by Carlyle’s extensive experience in the credit markets, where it currently manages over $150 billion in credit assets. Carlyle is also the world's second largest CLO manager, which underscores its capability to steer VCIF towards potentially high returns.
The Fund’s existing investment adviser, Oakline Advisors, LLC, will step down upon the transaction's closure, with Ladenburg Thalmann & Co. Inc. and Thompson Hine LLP serving as financial and legal advisors respectively. Investors are encouraged to stay updated with ongoing filings and announcements available on the SEC’s website and the Fund's official portals.
For more information on Vertical Capital Income Fund’s initiatives and updates, visit www.VCIF.us and follow them on Twitter.
Saba Capital Management has expressed support for the proposed transaction between Vertical Capital Income Fund (NYSE: VCIF) and Carlyle Global Credit Investment Management. Partner Pierre Weinstein emphasized the potential benefits for shareholders, highlighting the planned tender offer as a significant opportunity. Saba views Carlyle's involvement as a positive development for investors in closed-end funds.
Vertical Capital Income Fund (NYSE: VCIF) announced a transaction agreement with Carlyle (NASDAQ: CG) to appoint Carlyle Global Credit Investment Management as its new investment adviser, pending shareholder approval. This shift aims to enhance value by focusing on collateralized loan obligations (CLOs). Carlyle will make a one-time payment of $10 million to shareholders and commit $50 million in equity investments. The Board unanimously supports this move, believing it aligns with strategic goals for maximizing shareholder returns. The transaction is expected to close in H1 2023, subject to necessary approvals.
Vertical Capital Income Fund (VCIF) announced the completion of property inspections on collateral supporting 34 loans across 26 Florida counties affected by Hurricane Ian. All inspections indicated no significant damage, leading to the removal of related asset valuation reductions. However, the Fund warns of potential long-term impacts on property values due to changing demand. In November 2022, VCIF distributed $0.0687 per share to shareholders. The source of distribution includes net investment income and returns of capital, with estimates indicating over-distribution relative to income.
Vertical Capital Income Fund (NYSE: VCIF) addressed the impact of Hurricane Ian, noting potential damage to mortgage-backed properties. In 26 Florida counties designated as disaster areas by FEMA, the Fund has 34 loans, with inspections showing 25 are undamaged. The estimated net asset valuation will be reduced by about 1%. A monthly distribution of $0.0700 per share was paid to shareholders on October 19, 2022. The distribution sources include 40.86% net investment income and 59.14% return of capital. Future valuations will adjust as more inspection data becomes available.
FAQ
What is the market cap of VCIF (VCIF)?
What is Vertical Capital Income Fund's primary investment strategy?
What recent transaction did Vertical Capital Income Fund announce?
How will the transaction with Carlyle affect the Fund's net asset value?
What changes will take place in the Fund's advisory management?
What is the expected benefit for shareholders from the Carlyle transaction?
Will there be a change in the Fund's dividend policy?
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Will the Fund's investment focus remain the same?
What is the nature of the special one-time payment to shareholders?
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