Hercules Capital has closed an upsized public offering of $400 million in aggregate principal amount of 6.7% unsecured notes due October 2029, providing the venture lender with additional capital for debt repayment, new investments and general corporate purposes.
The notes will mature on October 8, 2029, and carry an annual interest rate of 6.7%, payable semiannually.
Hercules may redeem the notes in whole or in part before maturity at par plus an applicable make-whole premium, giving the company flexibility to refinance or retire the securities early if market conditions or its capital needs change.
The offering received investment-grade ratings from two major agencies. Moody’s Investors Service initially assigned the notes a Baa2 rating, while Fitch Ratings assigned a BBB- rating.
Hercules plans to use the net proceeds to repay outstanding secured or unsecured indebtedness, fund investments consistent with its investment objectives, and support general corporate purposes.
The financing provides additional liquidity for Hercules as it continues deploying capital into high-growth, venture-backed companies.
Hercules primarily provides senior secured venture growth loans, giving technology, life sciences and other innovation-focused companies access to capital that can complement equity financing.
Since its founding in 2003, Hercules has committed more than $28 billion to over 700 companies across its target sectors.
The new notes expand the company’s funding base and provide longer-term capital through 2029 that can be used to support additional lending activity while also managing existing debt obligations.
The $400 million offering ultimately strengthens Hercules Capital’s liquidity position while supporting its strategy of providing growth financing to venture-backed companies across technology, life sciences and other innovation-driven industries.
Support: Goldman Sachs, SMBC Nikko Securities America and MUFG Securities Americas served as joint book-running managers for the offering. Citizens JMP Securities, DZ Financial Markets, RBC Capital Markets, R. Seelaus & Co., Synovus Securities, Wedbush Securities and Zions Direct acted as co-managers.
