Horizon Technology Finance Corporation announced on December 11, 2025 that it has priced a registered direct offering of $57.50 million in 7.00% notes due 2028. The notes mature on December 15, 2028 and may be redeemed in whole or in part at any time prior to June 15, 2028 at par plus a make‑whole premium, and thereafter at par plus accrued and unpaid interest.
The net proceeds will be used to repay the company’s existing 4.875% notes due 2026 and for other general corporate purposes, including supporting its venture‑loan portfolio and providing liquidity for the pending merger with Monroe Capital Corporation. By issuing higher‑rate debt at a lower coupon, Horizon aims to reduce its overall cost of capital and strengthen its balance sheet as it moves toward a combined entity with Monroe.
Horizon is a specialty finance company that provides secured loans to venture‑backed technology, life‑science, healthcare information services, and sustainability firms. The merger with Monroe Capital, announced on August 7, 2025 and expected to close in December 2025, is a key strategic initiative that will expand the combined company’s scale and capital base. The new notes are part of a broader strategy to maintain a conservative debt structure while increasing liquidity for future growth.
In its most recent quarterly earnings, Horizon reported a net investment income of $0.32 per share for Q3 2025, beating the consensus estimate of $0.274 per share. The earnings beat reflects disciplined cost management and a favorable mix of high‑yield investments, reinforcing confidence in the company’s ability to service its debt obligations and support the new financing.
The refinancing of the 4.875% notes with the 7% notes reduces Horizon’s weighted‑average cost of debt, improves its leverage profile, and provides additional capital to fund new investments and support the merger. The transaction positions the company to capitalize on growth opportunities in its core markets while maintaining a strong balance sheet for the next several years.
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