FS KKR Capital Sells $400 Million Junk Bonds to Refinance Debt

1 articles · Updated · Bloomberg · Jun 1

$400 million of notes are being marketed by FS KKR Capital Corp. in a rare high-yield bond sale by a publicly traded business development company.
Initial pricing discussions put the bonds' yield in the mid- to high-7% range, reflecting the issuer's junk rating and current market terms.
People familiar with the matter said the proceeds may be used to refinance existing debt, making the deal primarily a liability-management move rather than new funding.
The offering stands out because publicly traded credit funds seldom tap the junk-bond market, underscoring an unusual financing route for a private-credit-linked vehicle.

Sued for hiding bad loans, can FS KKR's junk bond sale fix its deteriorating portfolio or is it throwing good money after bad?

Is FS KKR's fall to junk status an isolated case or the canary in the coal mine for the entire private credit industry?