Medley Capital Corp. is looking for a buyer after its deal with Sierra Income Corp. was terminated last month, per Bloomberg.

The merger agreement signed in 2018 collapsed due to the coronavirus pandemic-induced economic uncertainties. Medley Capital had announced that its Special Committee of the board of directors will remain in place and this committee will search for other alternatives to enhance shareholder value.

Per persons familiar with the matter, Medley Capital’s financial adviser, HoulihanLokey (HLI), has been trying to seek potential buyers for the company. Nonetheless, no final decision has been taken and it might remain independent.

Business Development Companies (BDCs) like Medley Capital have been hit hard by the coronavirus pandemic, which has wreaked havoc in the financial markets. As these companies lend mostly to small- and medium-sized businesses, many of which had to shut down due to the pandemic, this is a tiring time for BDCs. Various other concerns, ranging from liquidity crisis for Golub Capital BDC (GBDC Quick QuoteGBDC - Free Report) and Bain Capital (BCSF Quick QuoteBCSF - Free Report) , to exposure to highly-affected sectors like aviation for Portman Ridge Finance (PTMN Quick QuotePTMN - Free Report) , have placed these companies in a disadvantageous position.

Shares of Medley Capital have depreciated 65.6% so far this year compared with the 4% decline recorded by the industry.

The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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