Fitch Rates MCG Capital Corp's Unsecured Notes 'BB+'; Outlook Negative

Fitch Ratings has assigned a rating of 'BB+' to MCG Capital Corporation's (MCG) $34.3 million of senior unsecured notes. All relevant ratings are listed at the end of this release.

These notes effectively replace and extend the maturity of existing series 2005-A unsecured notes which were scheduled to mature in October 2010. The maturity of the new notes will be October 2011. In exchange for the maturity extension, the interest rate on the notes will increase 100 basis points to 9.98% and MCG will make a $5 million principal payment on its existing unsecured debt, which will be applied pro rata to the new notes and the notes maturing in October 2012 based on the current amount outstanding. Additionally, the cash sweep of net proceeds on unencumbered asset sales will increase from 40% to 45% after the SunTrust facility receives its 7.5% sweep on the sale of the first $100 million of unencumbered assets.

Fitch's rates MCG as follows:

MCG Capital Corporation

--Long-term Issuer Default Rating 'BB+';

--Senior unsecured debt 'BB+'.

The Rating Outlook is Negative.

Additional information is available at www.fitchratings.com.

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SOURCE: Fitch Ratings

Fitch Ratings 
Meghan (Crowe) Neenan, CFA, 212-908-9121, New York 
William A. Artz, 312-368-3178, Chicago

Related terms: debt, rates, sales