CSWC 📈 Capital Southwest - Overview

Capital Southwest Corporation is a business development company that focuses on providing credit and private equity investments to middle market companies. This means they invest in businesses that are already established and have a proven track record, but need additional funding to grow or expand their operations.

The company avoids investing in startups, publicly traded companies, and real estate developments, as well as businesses that are struggling or have significant management turnover. Instead, they focus on providing growth capital, refinancing, and acquisition financing to companies in the lower middle market.

In terms of investment structures, Capital Southwest Corporation uses a variety of debt and equity instruments, including unitranche debt, subordinated debt, senior debt, and preferred and common equity. They also make equity co-investments alongside debt investments, but only up to 20% of the total investment and never take control of the company.

The company is industry agnostic, meaning they invest in a wide range of sectors, but they have a preference for certain industries such as industrial manufacturing and services, value-added distribution, healthcare products and services, business services, specialty chemicals, food and beverage, tech-enabled services, and SaaS models.

Within the energy sector, Capital Southwest Corporation focuses on investing in energy services and products, excluding exploration and production. They look for companies that offer differentiated products and services, equipment and tool rental, consumable products, and drilling and completion chemicals.

In the industrial technologies sector, the company seeks to invest in automation and process controls, handling and packaging equipment, industrial filtration and fluid handling, measurement, monitoring and testing, professional tools, and sensors and instrumentation.

Finally, within specialty chemicals and products, Capital Southwest Corporation looks for companies that offer unique and innovative products and services. To learn more about the company and its investment strategy, you can visit their website at https://www.capitalsouthwest.com.