Investcorp BDC agrees to merge at 90% NAV

Investcorp Credit Management BDC (NASDAQ:ICMB) agreed to merge with BCP Investment Corporation (NASDAQ:BCIC), with ICMB shareholders set to receive 90% of its net asset value at closing, subject to adjustments, as the company reported a third-quarter net loss of $4.8 million, or $0.33 per share.

Total investment income fell to $3.14 million from $4.36 million a year earlier and missed the $4.61 million analyst estimate, while net investment loss before taxes reached $1.8 million, or $0.13 per share.

Net asset value fell $0.42 to $3.02 per share, while the 31-company portfolio's weighted average debt yield declined to 9.53% from 10.51%.

The adviser waived $0.6 million in quarterly management fees and $0.2 million in previously accrued incentive fees.

Following the announcement, the Investcorp Credit Management BDC share price was up 53.54% at $0.95 in after-hours trading, while the companies expect to complete the merger in the first quarter of 2027, subject to ICMB shareholder approval and customary conditions.

ICMB invests primarily in debt and related equity of middle-market businesses, while BCIC said the combination is expected to reduce duplicate public-company expenses, lower financing costs and improve trading liquidity.

Under the agreement, ICMB shareholders will receive BCIC shares valued at 100% of BCIC's net asset value per share, capped at 19.99% of its outstanding stock, with any remaining consideration paid in cash.

The transaction's NAV-based valuation is approximately $2.49 per ICMB share, compared with a market-price-implied value of $1.38, representing a 126% premium over ICMB's November 9 closing price of $0.61.