Apollo Investment Corporation

Between a bank loan and a public bond issue lies the middle market, and one listed vehicle has long existed to lend there. Apollo Investment Corporation, which traded on Nasdaq as AINV, was renamed MidCap Financial Investment Corporation and now trades as MFIC. Its older website, still preserved on the listing, describes it as a publicly traded closed-end management investment company that offers private middle-market companies an alternative to traditional financing sources.

What it is

The company is an externally managed business development company, a structure created under the Investment Company Act of 1940, and it has elected to be treated as a regulated investment company for tax purposes. Its stated aim is income now, with some growth in capital as a secondary goal. It is managed by an affiliate of Apollo Global Management, which the company describes as a global alternative asset manager. Its investment adviser is Apollo Investment Management, an Apollo affiliate.

From mixed debt to senior loans

In its original form, the portfolio consisted mainly of subordinated debt and senior secured debt in privately held companies. The current focus is narrower: senior debt solutions for middle-market companies, and in particular senior secured first lien loans originated by MidCap Financial, a middle-market direct lender managed by Apollo. The company says it gains considerable benefits from its tie to Apollo and from the partnership with MidCap Financial, including the ability to co-invest alongside other Apollo capital, which it says helps it provide large commitments.

Apollo's origination platform

MFIC operates within Apollo's Direct Origination Platform, which provides full-service debt solutions to US middle-market companies. The platform works with financial sponsors and with niche markets that have high barriers to entry, and it finds opportunities through Apollo's relationships with intermediaries on Wall Street.

For shareholders

The company presents itself as a route for investors to reach institutional-quality private credit through a listed share, and it says it does so with an industry-leading fee structure. It publishes quarterly earnings press releases, supplemental information and regulatory filings, and runs earnings calls. Its pages describe a historical investment record and portfolio, and the shareholder materials are where current figures are found, since figures quoted on the older pages are out of date.

Apollo Investment Corporation is a publicly traded closed-end investment company, later renamed MidCap Financial Investment Corporation. It provides financing to private middle-market companies as an alternative to traditional lenders.

Products and services

• Senior debt: the current focus is on senior debt solutions for middle-market businesses.
• Subordinated and secured lending: the earlier portfolio was mainly subordinated and senior secured debt.
• Access for shareholders: lets investors take part in private credit through a listed vehicle.
• Investor reporting: publishes results, earnings materials and filings for each quarter.

Customers and markets

Privately held middle-market companies that need finance, and shareholders who want exposure to private credit.

Key facts

• Listing: Nasdaq, under the symbol MFIC (previously AINV)
• Structure: externally managed business development company
• Affiliation: connected to Apollo and to MidCap Financial
• Objective: current income and, to a lesser extent, capital growth