MCG Capital Reaffirms Recommendation In Favor Of Merger With PennantPark

(RTTNews) - MCG Capital Corp. (MCGC) announced that its Board has determined that the proposal to acquire MCG made by HC2 Holdings Inc. does not constitute, and is not reasonably likely to lead to, a superior proposal under MCG's existing merger agreement with PennantPark Floating Rate Capital Ltd. (PFLT). The Board has unanimously affirmed its commitment to the pending merger with PFLT, and its recommendation that MCG stockholders vote in favor of the PFLT transaction.

On April 28, 2015, MCGC executed a merger agreement with PennantPark Floating Rate Capital Ltd. which provides for the acquisition of MCGC by PFLT in a stock and cash transaction currently valued at approximately $175.0 million, or approximately $4.75 per MCGC common share at closing, representing a 15.8% premium to MCGC's closing stock price on April 28, 2015.

Last month, HC2 Holdings, Inc. (HCHC) announced it sent a letter to MCG Capital Corporation (MCGC) again proposing an agreement for HC2 to acquire MCG. HC2's proposal is to acquire 100% of the common stock of MCGC on a fully-diluted basis in a cash and stock transaction in which stockholders of MCGC would receive $5.25 for each share of MCGC common stock outstanding.