Carlyle Secured Lending, Inc. Announces Merger with Carlyle Secured Lending III

Provides meaningful scale and diversity to CGBD through addition of a Carlyle-managed portfolio

Carlyle to exchange CGBD convertible preferred stock for CGBD common stock at NAV, eliminating current 5% – 8% preferred stock dilution overhang

Advisors agreed to cover transaction costs in certain circumstances up to a total cap of $5 million

NEW YORK, Aug. 05, 2024 (GLOBE NEWSWIRE) -- Carlyle Secured Lending, Inc. (together with its consolidated subsidiaries, “we,” “us,” “our,” “CGBD” or the “Company”) (NASDAQ: CGBD), a business development company focused on directly-originated lending to sponsor-backed U.S. middle market companies, has entered into a definitive agreement to acquire Carlyle Secured Lending III (“CSL III”), a private business development company with a similar investment strategy and portfolio. The stock-for-stock transaction will have a floating exchange ratio that has the potential to allow CGBD and CSL III to share the benefits if CGBD is trading above NAV shortly before merger close. Following closing, CGBD is expected to have total assets of over $2.5 billion and net assets of over $1.2 billion.¹

“We are excited to announce the merger of CGBD and CSL III, which is designed to have meaningful benefits for investors of both entities,” said Justin Plouffe, Chief Executive Officer for CGBD and CSL III. “Given substantial overlap in strategy and portfolio composition, combining CGBD and CSL III into a single, larger, and more liquid vehicle will result in significant stockholder value creation and an enhanced investor experience. We are confident in this transaction’s potential to drive greater trading volume, access to an expanded stockholder base, and lower operating and financing costs. There is strong momentum across our direct lending franchise, and we believe bringing CGBD and CSL III together will enable us to build on that momentum.”

In order to enhance the benefits of the transaction for stockholders, Carlyle Investment Management L.L.C. (“CIM”), a wholly owned subsidiary of Carlyle, has agreed to exchange its shares of CGBD convertible preferred stock for CGBD common stock. The CGBD convertible preferred stock was issued by CGBD as part of an investment Carlyle made to support CGBD during the market dislocation resulting from the COVID pandemic. This exchange will eliminate the dilutive impact of the preferred stock, which has a conversion price of $8.98 compared to CGBD’s June 30^th NAV per share of $16.95.²