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Stonegate Capital Partners Initiates Coverage on WhiteHorse Finance, Inc. (Nasdaq: WHF)

DALLAS, TX / ACCESSWIRE / July 25, 2019 / WhiteHorse Finance, Inc. (WHF)


WhiteHorse Finance, Inc. is an externally managed, closed-end management investment company that has elected to be treated as a business development company (“BDC”) under the Investment Company Act of 1940. The Company’s investment objective is to generate attractive risk-adjusted returns by originating senior secured loans to privately held companies across a range of industries. WhiteHorse Finance’s investment activities are managed by an affiliate of H.I.G Capital, manager of $30 billion of capital.

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  • WhiteHorse Finance, Inc. is an externally managed business development company (BDC) focused on first lien and second lien senior secured investments in lower middle market companies with enterprise values between $50 million and $350 million.
  • WhiteHorse Finance has elected to be treated as a business development company (BDC) under the Investment Company Act of 1940 and has elected to be treated as a regulated investment company (RIC) for tax purposes.
  • WHF seeks to generate attractive risk-adjusted returns by originating and investing in loans to lower middle market companies across a wide range of industries. Typically, the Company’s loans carry a floating rate based on LIBOR with a term of three to six years. Current income is generated through the receipt of interest payments, origination and other fees, capital appreciation and dividends.
  • Primarily, the Company invests in securities that are, or would be, rated below investment grade by rating agencies, commonly referred to as “junk” bonds. These are viewed as more speculative investments due to concerns with the issuer’s capacity to pay interest and repay principal.
  • H.I.G. Capital’s extensive network provides proprietary sourcing and deal flow from 40 dedicated deal professionals. The three-tier sourcing platform allows WHF to generate an attractive pipeline of investment opportunities. All potential investment opportunities undergo a rigorous credit process focused on fundamental analysis emphasizing downside protection and cash flow visibility.
  • The Company’s portfolio is well diversified with 41 companies representing 27 industry sectors. WhiteHorse’s average investment size is $8.4M with their largest portfolio company investment being $26M.
  • WHF has produced consistent quarterly dividends of $0.355 per share since 2012 IPO
  • To help frame valuation, we are using a P/NAV range of 1.0x to 1.2x. Using this range, we arrive at a valuation range of $15.33 to $18.40 with a midpoint of $16.86. See page 6 for further details.

About Stonegate Capital Partners

Stonegate Capital Partners is a Dallas-based corporate advisory firm dedicated to serving the specialized needs of small-cap public companies. Since our inception, our mission has been to find innovative, undervalued public companies for our network of leading institutional investors who seek high-quality investment opportunities.


Shane Martin

SOURCE: Stonegate Capital Partners

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