The following is a summary of the Carlyle Secured Lending Inc. (CGBD) Q2 2024 Earnings Call Transcript:

Financial Performance:

• Carlyle Secured Lending Inc. (CGBD) reported a net investment income of $0.51 per share for Q2 2024, with an annualized yield of more than 12%.

• Announced a third quarter dividend of $0.47 per share, consisting of a base dividend of $0.40 plus a $0.07 supplemental dividend.

• Reported a net asset value of $16.95 per share as of June 30, 2024, representing a decrease of approximately 0.7% from March 31 due to unrealized depreciation.

Business Progress:

• Carlyle Secured Lending has entered into a merger agreement with Carlyle Secured Lending III (CSL III), aiming to increase scale, liquidity, and operational efficiencies.

• This merger is expected to be both earnings and NAV per share accretive, contribute to cost savings, and reduce preferred stock dilution.

• The merger will create a combined entity with a market capitalization over $1 billion, anticipated to enhance trading liquidity and institutional ownership.

Opportunities:

• The merger with CSL III presents opportunities for cost savings estimated at approximately $2.5 million annually. Furthermore, by eliminating duplicative expenses and leveraging increased scale, a significant operational efficiency is envisaged.

• With more than 90% of the new, combined entity's investments in senior secured loans, the merger consolidates Carlyle's leading position in the middle-market lending space, potentially bolstering its competitive market stance.

Risks:

• The merger execution poses integration risks and hinges on achieving anticipated cost synergies and operational efficiencies. Additionally, there are potential challenges from market conditions and integration of portfolio investments.

• The dependency on external market conditions and potential financial implications if these conditions fluctuate unfavorably.

More details: Carlyle Secured Lending IR

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