Capital Southwest Plans Spin-off - Quick Facts

(RTTNews) - Capital Southwest Corp.'s (CSWC) ("CSWC") board has approved a plan to spin-off certain of its control assets into a standalone, publicly traded company. The separation will unlock shareholder value immediately and to enhance long-term shareholder value by establishing two strong, independent companies with distinct growth strategies: one business will be a diversified industrial growth company and the other will focus chiefly on lending to strong middle market companies in the Southwest and across the country.

Following the completion of the separation, Industrial Co. will consist of the following businesses, that are currently control investments of CSWC: The RectorSeal Corp., the Whitmore Manufacturing Co., and Jet-Lube, Inc.

Commenting on the transaction, Capital Southwest's Chief Investment Officer, Bowen Diehl, who is expected to be Chief Executive of CSWC post transaction, stated: "Upon completion of the separation, CSWC is expected to have a significant capital base, which we intend to leverage to build an investment portfolio with attractive risk-adjusted returns to support a competitive market dividend. We are confident that over time this strategy will enable CSWC to trade at or above net asset value."

Upon completion, the holder of each CSWC share will receive a pro rata distribution of stock of the Industrial Co. The proposed transaction will be structured as a tax-free distribution to CSWC shareholders and is contingent upon the satisfaction of several conditions. The spin-off is likely to be consummated by the end of the third quarter of 2015.