Mount Logan Capital Inc. Announces Purchase of Minority Stake in U.S. Asset Management Platform
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TORONTO, Dec. 17, 2020 (GLOBE NEWSWIRE) — Mount Logan Capital Inc. (NEO: MLC) (“Mount Logan” or the “Company”) is pleased to announce that a wholly-owned subsidiary of the Company has completed the acquisition of a 21.4% equity stake in Sierra Crest Investment Management LLC (“Sierra Crest”) from an arms-length third party for a purchase price of $7.0 million, funded by a combination of newly incurred debt and a deferred cash consideration. Sierra Crest is a registered investment adviser under the U.S. Investment Advisers Act of 1940, as amended, whose primary activities are the management of Portman Ridge Finance Corporation (“Portman Ridge”) and the Alternative Credit Income Fund (“CIF”, formerly known as the Resource Credit Income Fund).Portman Ridge is a U.S.-based, closed-end, externally managed, business development company (“BDC”) within the meaning of the U.S. Investment Company Act of 1940, as amended (the “1940 Act”), that invests in performing, well-established, middle market businesses that operate across a wide range of industries. As of October 28, 2020, following the close of its merger with another U.S.-based BDC, Portman Ridge had estimated total assets of $638 million. Shares of common stock of Portman Ridge are quoted on the Nasdaq Global Select Market under the symbol “PTMN.” Sierra Crest also serves as the registered investment adviser for CIF of which Mount Logan receives the net economic benefits derived under the advisory agreement for CIF.Ted Goldthorpe, CEO and Chairman of Mount Logan, noted, “We are very pleased with the purchase of the minority stake in Sierra Crest, which will drive future earnings growth and further diversifies our business. The U.S. Direct Lending market has experienced considerable growth over the last several years and the BDC structure is a highly attractive business model to participate in what we believe to be continuing growth trends. Additionally, we believe there is significant organic and inorganic growth potential for Sierra Crest based on its management of Portman Ridge. As part of this transaction, Mount Logan gains exposure to another scaled asset management platform with permanent capital and greater shifts our business towards an asset-light model.”About Mount Logan Capital Inc.Mount Logan Capital Inc. is an alternative asset management company that is focused on public and private debt securities in the North American market. The Company seeks to source and actively manage loans and other debt-like securities with credit-oriented characteristics. The Company actively sources, evaluates, underwrites, monitors and primarily invests in loans, debt securities, and other credit-oriented instruments that present attractive risk-adjusted returns and present low risk of principal impairment through the credit cycle.This press release contains forward-looking statements and information within the meaning of applicable securities legislation (collectively referred to herein as “forward-looking statements”). Forward-looking statements can be identified by the expressions “seeks”, “expects”, “believes”, “estimates”, “will”, “target” and similar expressions. The forward-looking statements are not historical facts, but reflect the current expectations of management of the Company regarding future results or events and are based on information currently available to them. Certain material factors and assumptions were applied in providing these forward-looking statements. The forward-looking statements discussed in this press release may include, but are not limited to, statements relating to the Company’s transition to an asset-light business model; the additional earnings potential as a result of the acquisition of an interest in Sierra Crest, the ability of Sierra Crest to further scale its business; and statements relating to the business and future activities of the Company. All forward-looking statements in this press release are qualified by these cautionary statements. The Company believes that the expectations reflected in forward-looking statements are reasonable based on upon the information available at the time such information was given; however, the Company can give no assurance that the actual results or developments will be realized by certain specified dates or at all. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including that the Company has only a minority interest in Sierra Crest and does not have the ability to affect the control over Sierra Crest or direct the management or policies of Sierra Crest, the risk that Sierra Crest may cease to be the investment adviser to Portman Ridge and/or CIF and may not enter into further asset management agreements in order to scale and grow its business, the Company has a limited operating history with respect to an asset-light business model as well as the matters discussed under “Risk Factors” in the most recently filed annual information form and management’s discussion and analysis for the Company. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, a forward-looking statement speaks only as of the date on which such statement is made. The Company undertakes no obligation to publicly update any such statement or to reflect new information or the occurrence of future events or circumstances except as required by securities laws. The forward-looking statements in this press release are made as of the date of this press release.This press release is not, and under no circumstances is it to be construed as, a prospectus or an advertisement, and the communication of this press release is not, and under no circumstances is it to be construed as, an offer to sell or a solicitation of an offer to purchase securities of the Company. This press release is not intended for U.S. persons. The Company’s shares are not and will not be registered under the U.S. Securities Act of 1933, as amended, and the Company is not and will not be registered under the 1940 Act. U.S. persons are not permitted to purchase the Company’s shares absent an applicable exemption from registration under each of these Acts. In addition, the number of investors in the United States, or which are U.S. persons or purchasing for the account or benefit of U.S. persons, will be limited to such number as is required to comply with an available exemption from the registration requirements of the 1940 Act.For additional information, please contact:Ted Gilpin, Chief Financial Officer