Ares Capital Corporation (ARCC) priced an $800 million offering of 5.550% unsecured notes due 2030 on May 4 2026. The notes mature on January 15 2030 and may be redeemed in whole or in part at the company’s option at par plus a make‑whole premium, if applicable.
The proceeds will be used to repay outstanding debt facilities, with the flexibility to reborrow for general corporate purposes, including new investments in portfolio companies. The transaction is part of ARCC’s strategy to reduce its exposure to floating‑rate debt—approximately 74% of its $15.9 billion total debt as of March 31 2026—by locking in a fixed rate in a market where the Federal Reserve’s policy rate is 3.5‑3.75%.
The offering was underwritten by a syndicate of 28 financial institutions, including BofA Securities, J.P. Morgan, and RBC Capital Markets, underscoring strong demand for ARCC’s unsecured notes. The 5.550% coupon is considered a competitive yield for an unsecured BDC in the current low‑rate environment, reflecting market confidence in ARCC’s creditworthiness and scale.
By issuing fixed‑rate debt, ARCC gains predictability in interest expenses and preserves liquidity for lending and investment activities. The transaction also signals the company’s continued focus on maintaining a robust capital base while managing interest‑rate risk, positioning it to support its middle‑market portfolio in a potentially tightening credit environment.
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