8-K: Carlyle Secured Lending Completes Merger with Carlyle Secured Lending III, Announces Shareholder Approval

Carlyle Secured Lending, Inc. finalized its acquisition of Carlyle Secured Lending III following shareholder approval, aiming to enhance portfolio scale and efficiency.

Summary

• Carlyle Secured Lending, Inc. (CGBD) completed its acquisition of Carlyle Secured Lending III (CSL III) on March 27, 2025.
• CGBD issued approximately 18,935,108 shares of its common stock to former CSL III shareholders as part of the merger.
• Carlyle Investment Management L.L.C. (CIM) exchanged 2,000,000 shares of convertible preferred stock for 3,004,808 shares of CGBD common stock.
• CGBD succeeded to obligations under the CSL III SPV Credit Facility, which provides for secured borrowings of $250.0 million.
• As of March 27, 2025, CGBD had $206.0 million outstanding under the CSL III SPV Credit Facility.
• The CSL III SPV Credit Facility has a revolving period through September 30, 2025, and a maturity date of September 30, 2030, with an extension option.
• Borrowings under the CSL III SPV Credit Facility bear interest at three-month SOFR plus 2.85%.
• CIM entered into a lock-up agreement restricting the transfer of common stock for periods ranging from 360 to 720 days after the closing date.
• CGBD and CIM also entered into an amended and restated registration rights agreement.

Sentiment

Score: 7

Explanation: The document conveys a positive sentiment due to the successful completion of the merger and anticipated benefits. However, it also acknowledges risks and uncertainties, preventing a higher score.

Positives

• The merger is expected to create long-term value through increased portfolio scale and efficiency.
• CGBD now has access to the $250.0 million CSL III SPV Credit Facility.

Negatives

• CIM is subject to a lock-up agreement restricting the transfer of common stock for periods ranging from 360 to 720 days after the closing date.

Risks

• The announcement mentions forward-looking statements that involve risks and uncertainties.
• These risks include the ability to realize anticipated benefits of the mergers, economic and political trends, and changes in laws or regulations.

Future Outlook

The combined company expects to create long-term value through increased portfolio scale and efficiency.

Management Comments

• Justin Plouffe, Chief Executive Officer of CGBD and CSL III, said, 'We thank shareholders for their approval and strong support of the transaction. We have conviction in the strategic benefits and value of the merger for both sets of shareholders, and we expect the combined company to create long-term value through increased portfolio scale and efficiency.'

Industry Context

This announcement reflects a trend of consolidation within the business development company (BDC) sector, where companies seek to achieve greater scale and operational efficiencies.

Related Party Transactions

• CIM exchanged preferred stock for common stock and entered into a lock-up agreement and registration rights agreement with CGBD.

Stakeholder Impact

• Shareholders of CSL III received CGBD common stock.
• Shareholders of CGBD are expected to benefit from increased portfolio scale and efficiency.

Next Steps

• The transaction is expected to close on or about March 27, 2025, subject to satisfaction or waiver of customary closing conditions.

Key Dates

Keywords

merger, acquisition, Carlyle Secured Lending, Carlyle Secured Lending III, CSL III SPV Credit Facility, common stock, preferred stock, SOFR, lock-up agreement, registration rights