Goldman Sachs in Public Offering Of MCG Stock

June 22, 2005

Cleary Gottlieb represented Goldman Sachs Capital Partners and affiliated Goldman private equity funds in the disposal of a portion of their minority equity investment in MCG Capital Corporation.  On June 22, five Goldman Sachs investment vehicles sold approximately $32 million of MCG stock.  This disposition decreased Goldman Sachs’s equity ownership percentage from 8.5% to approximately 4%.  MCG conducted a simultaneous primary offering of approximately $42 million of stock, bringing the total offering size to approximately $74 million. 

MCG is a closed-end investment company providing solutions-focused financing and advisory services to a variety of small and medium-sized companies throughout the United States, with a focus on growth-oriented companies.  Its portfolio currently consists primarily of companies in the communications, information services, media and technology, including software and technology-enabled business services, industry sectors.  MCG was formed by its management and affiliates of Goldman Sachs in 1998, and began operations after purchasing a loan portfolio and certain other assets from First Union National Bank (which subsequently merged with Wachovia Corporation) in a management buyout.