GE Capital Signs Deal with CIFC for $4.9M, 1M Shares
GE Capital Corp. and asset manager CIFC Corp. DFR 0.00% have inked an agreement to explore business opportunities and facilitate third-party investment advisory referrals.
Under the terms of the agreement unveiled Tuesday, GE Capital will receive one million shares of CIFC common stock–valued at Monday’s close at $7.25 million–warrants to purchase two million shares of a newly created class of non-voting CIFC preferred stock, and about $4.9 million in cash from CIFC.
The two companies will form a commercial council made of senior members of both companies. Peter Gleysteen, chief executive of CIFC, and Neeraj Mehta, a GE officer, are slated to serve as co-chairs of the council. GE Capital has the right to appoint an executive to CIFC’s board.
GE Capital Debt Advisors LLC, a unit of GE Capital, will exit its third-party investment advisory business, and has agreed to assign its role as manager of four collateralized loan obligation funds representing about $700 million in assets under management to CIFC Asset Management LLC, a unit of CIFC.
The transaction is expected to close in September.
Shares of CIFC closed at $7.25 Monday and were inactive premarket. The stock is up 34% so far this year.