Ares Capital Sees New BDC Law As Positive For Capital Availability

(RTTNews) - Ares Capital Corp. (ARCC), a specialty finance company, said it plans to recommend a path for approval of a certain provision contained in the recently passed Small Business Credit Availability Act or SBCAA that was signed into law on March 23, 2018.

The company noted that the SBCAA includes a provision that permits business development companies or BDCs to seek approval to operate with higher leverage ratios and also provides certain securities reforms intended to improve offering flexibility.

Ares Capital said that having completed its evaluation of the various alternatives, it intends to discuss specific plans for implementation with its Board of Directors and other constituents.

"We anticipate the SBCAA will enable BDCs to provide more capital to middle market companies while improving portfolio diversification and capital markets access for the BDC industry. The passage of this legislation provides BDCs a choice to operate with greater flexibility and meaningfully enhances the growth prospects for our industry," said Michael Arougheti, Chief Executive Officer and President of Ares Management, L.P. and Co-Chairman of Ares Capital.