In the IVQ 2021, MacuLogix Inc. – a company that develops tests for macular degeneration – defaulted on its debt maturing September 1, 2023. We know this from Horizon Technology Finance (HRZN) – one of its senior lenders. (The BDC also owns equity in the company).
Now we’ve just heard from HRZN regarding its IQ 2022 results and discovered the debt remains on non accrual and has been reduced further in value. Moreover, the BDC has made additional loans, due in 2022. All these loans are carried as non performing. The total capital invested is $12.1mn, up $0.4mn from the prior quarter, at cost. The latest value is $5.5mn, indicating a (55%) discount has been taken by the BDC overall.
The BDC Credit Reporter rates the company CCR 5.
We can’t tell from the public record what ails MacuLogix, or what the outcome might be for HRZN’s investment. We can say that the BDC is not receiving ($1.2mn) of annual investment income and may yet have to advance more funds to protect its interests. We’ll provide an update when we hear anything useful.