The BDC Credit Reporter has had Martex Fiber Southern Corp on the under performers list since IIIQ 2017. As of September 2019, the company was valued by THL Credit (TCRD) – it’s only BDC lender – at a (30%) discount to its $9.9mn cost. Now, with the latest TCRD conference call covering the year ended December 31, 2019, we hear the investment was “repaid at a loss”. To be specific, in January 2020, the BDC received $4.2mn, suggesting the realized loss to be booked will be ($5.7mn) and the additional loss between September and now is ($2.7mn).
No back story was provided about the payoff. TCRD is anxious to be done with its troubled portfolio companies and may have just “dumped” the debt. In any case, we have removed Martex from the under performers list.