Yes they are adding additional shares, but this secondary will be highly accretive to NAV & NII per share for existing shareholders.
TCAP is netting $25.81 per share from this secondary. Add the new equity raised to TCAP's previous net equity, and then add the new shares to the previous share count.
$445,774,416 -- Q2 net equity
$110,983,000 -- New equity from secondary ($25.81 x 4.3mm new shares)
$556,757,416 -- New net equity
27,939,795 -- shares outstanding at end of Q2
4,300,000 -- New secondary shares
32,238,795 -- New share count
Then divide the new net equity by the new number of shares. That will get you TCAP's new NAV of $17.27. That's better than an 8% increase in NAV, plus I haven't factored in the over-allotment shares which most certainly will be sold.
In addition, once this new capital is deployed, it will easily be accretive to NII for existing shareholders. Keep in mind TCAP has already funded about $58mm in new investments in July which accounts for about half the new capital being raised today.
Secondaries like this highlight why the strong have major advantages over the weak.
Seems as though most companys go around 20 to 25% when they want to raise cash, so this seems in line with their conservative business approach. Q1 earnings call said revenue streams would be lower in the first half due to investment timing, they may feel the need for a larger war chest.
If tcap trades at 2 times book value, does this mean that adding 14% to the book will add 28% to market cap? I know it won't. I'm just saying that there is a premium to book that may result in an increased market cap beyond the offering once it is digested.