Key Takeaways
- • Source Capital (NYSE: SOR) traded at an average discount to net asset value of less than 10% during the Discount Management Program measurement period of January 1, 2025 through December 31, 2025, so no calendar year 2025 tender offer will occur.
- • The Fund traded at a premium to NAV during the fourth quarter of 2025, peaking at 1.20% on November 28, 2025.
- • The Board extended the Discount Management Program through December 31, 2027, adding a contingent tender offer for 10% of outstanding shares at 98% of NAV if the average discount exceeds 10% in 2027.
- • Approximately 21.7% of NAV was invested in private credit as of December 31, 2025, with combined invested and committed private credit capital at approximately 25.9% of NAV.
- • The Fund will host an investor call on February 26, 2026, at 1pm PST, with details posted at fpa.com.
Summary
The Board of Trustees of Source Capital (NYSE: SOR), a closed-end investment company managed by First Pacific Advisors, LP, announced that the Fund traded at an average discount to net asset value of less than 10% over the Discount Management Program measurement period running from January 1, 2025 through December 31, 2025, according to a Business Wire release dated January 16, 2026. Because the average discount remained under the 10% threshold, the contingent tender offer for calendar year 2025 will not occur. The Fund actually traded at a premium during the fourth quarter, peaking at a 1.20% premium to NAV on November 28, 2025.
The Board also approved a contingent tender offer for calendar year 2027 and extended the Program through December 31, 2027. Under the extended terms, the Fund will tender for 10% of its outstanding common shares at 98% of NAV per share if shares trade at an average discount of more than 10% during the 2027 measurement period, with any required tender closing no later than June 30, 2028. The Board may extend the Program beyond 2027. The release notes that the portfolio managers, officers and Board do not intend to tender their shares if a 2026 tender is required under the existing contingent offer. The Fund will also continue its Stock Repurchase Program to buy back stock at prices accretive to shareholders.
On private credit, the release states that the Fund has been increasing its allocation over the past few years. As of December 31, 2025, approximately 21.7% of NAV was invested in private credit, and combined invested plus committed capital reached approximately 25.9% of NAV. The Fund will host an investor call on February 26, 2026, at 1pm PST, with call details and question submission instructions to be posted at fpa.com. The release includes standard risk disclosures covering closed-end fund discounts and premiums, private placement illiquidity, leverage, and value-style investing.
The Board also approved a contingent tender offer for calendar year 2027 and extended the Program through December 31, 2027. Under the extended terms, the Fund will tender for 10% of its outstanding common shares at 98% of NAV per share if shares trade at an average discount of more than 10% during the 2027 measurement period, with any required tender closing no later than June 30, 2028. The Board may extend the Program beyond 2027. The release notes that the portfolio managers, officers and Board do not intend to tender their shares if a 2026 tender is required under the existing contingent offer. The Fund will also continue its Stock Repurchase Program to buy back stock at prices accretive to shareholders.
On private credit, the release states that the Fund has been increasing its allocation over the past few years. As of December 31, 2025, approximately 21.7% of NAV was invested in private credit, and combined invested plus committed capital reached approximately 25.9% of NAV. The Fund will host an investor call on February 26, 2026, at 1pm PST, with call details and question submission instructions to be posted at fpa.com. The release includes standard risk disclosures covering closed-end fund discounts and premiums, private placement illiquidity, leverage, and value-style investing.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.