Activist Investor Demands Investcorp Buy Out BDC Shareholders After Value Collapse

SADDLE BROOK, NJ – May 27, 2026 – Activist shareholder Bulldog Investors, LLP has issued a public ultimatum to Investcorp, demanding the investment manager take financial responsibility for the catastrophic decline of Investcorp Credit Management BDC (NASDAQ: ICMB). In a scathing press release, Bulldog urged Investcorp to acquire all publicly held shares of the beleaguered business development company for $5.04 per share, a stark contrast to its recent trading price of approximately $1.40.

The demand escalates a contentious battle over accountability, alleging that Investcorp enriched itself with exorbitant fees while shareholder value evaporated. Bulldog, which holds nearly 600,000 shares of ICMB, frames the situation as a direct consequence of mismanagement and broken fiduciary promises, turning a once-hopeful investment into what it describes as a “carcass.”

From 'Best in Class' to Shareholder Ire

The current conflict stands in sharp relief against the optimistic backdrop of June 2019, when Investcorp successfully solicited shareholder approval to become ICMB's investment manager. At the time, Investcorp painted a rosy picture, with ICMB’s net asset value (NAV) at $10.51 per share. Rishi Kapoor, Investcorp’s current Vice Chairman and Chief Investment Officer, assured investors that the firm was “committed to excellence” and to “delivering best in class performance.”

Kapoor further asserted that Investcorp's core values included “a very long history of putting the interest of our clients and shareholders first” and holding itself “accountable for performance and service.” These commitments, which included “fulfilling our ethical obligations” and “honoring our commitments,” were crucial in winning shareholder trust.

Seven years later, that trust has been shattered. ICMB’s share price has plummeted by nearly 90%, and its total market capitalization has dwindled to just $20 million. In a move described by Bulldog as potentially “unprecedented” for a BDC, the company suspended its dividend payments in early 2024, cutting off a vital source of income for its investors. The disconnect between management’s rhetoric and the company's reality was further highlighted as recently as March 2024, when Investcorp’s Executive Chairman, Mohammed Al Alardhi, publicly stated he saw no “dark clouds” for ICMB, viewing the private credit asset class as “a great opportunity…to offer good returns.”

Following the Money Trail

At the heart of Bulldog Investors’ outrage is the stark disparity between ICMB’s performance and the fees collected by its manager. The activist firm alleges that since 2019, Investcorp and its affiliates have collected approximately $43.5 million in various fees from ICMB. This figure is more than double the company’s entire current market value, a statistic that Bulldog presents as evidence of a fee structure that rewards the manager regardless of shareholder losses.

A significant portion of these fees, Bulldog claims, is a direct result of excessive leverage that Investcorp failed to control. The most glaring example cited is a conflicted, related-party transaction. To pay off maturing notes, Investcorp authorized ICMB to take a new loan from an Investcorp affiliate. This deal came at a steep price for ICMB shareholders: the company paid the affiliate over $1 million in various fees to secure the financing. Furthermore, the new loan carries an interest rate of more than 9% per annum, saddling ICMB with an increased annual interest expense of about $2.8 million—a massive burden for a company with a $20 million market cap.

Bulldog argues this transaction virtually guaranteed a material depletion of ICMB’s remaining net asset value, all while channeling fees to another arm of the Investcorp enterprise. This move is now the focal point of the activist’s demand for a specific buyout price.

A Cautionary Tale for the Private Credit Boom

The ICMB saga serves as a cautionary tale for the booming private credit market. Business Development Companies like ICMB have become popular vehicles for retail and institutional investors to gain exposure to direct lending in privately-held, middle-market companies. This market has grown exponentially, offering the promise of higher yields in a low-rate environment.

However, the structure of externally managed BDCs carries inherent risks. Managers are typically paid a base management fee calculated on gross assets and an incentive fee based on performance. This can create a potential conflict of interest, as managers may be incentivized to use leverage to grow the asset base—and thus their own fees—even if it amplifies risk for shareholders. When combined with rising interest rates, which increase a BDC's own borrowing costs and can stress its portfolio companies, this leverage can become a double-edged sword.

ICMB’s situation, with its deep and persistent trading discount to NAV (a share price of $1.40 versus a reported NAV of $4.76 as of year-end 2023), reflects a profound lack of market confidence. It highlights how poor underwriting, coupled with alleged self-dealing and a high-fee structure, can lead to disastrous outcomes for investors, even within a broadly growing asset class.

The Board's Move and the Activist's Ultimatum

In response to mounting pressure and the company's dire performance, ICMB's Board of Directors formed a Special Committee of independent directors on April 15, 2024. The committee has since hired the investment bank Houlihan Lokey as its financial advisor to explore “strategic alternatives” to maximize shareholder value, which could include a sale or merger.

Bulldog Investors, however, has dismissed this move. Phillip Goldstein, a managing partner of Bulldog, stated: “We see no need to incur more fees for a financial advisor.” He views the committee's process as another potential drain on the company's dwindling cash reserves.

Instead, Bulldog is calling for direct accountability from Investcorp. The demand for a buyout at $5.04 per share is not an arbitrary number; it represents ICMB’s last reported NAV before it signed the commitment letter for the costly affiliate loan in late 2025. Bulldog argues this price would rightfully return shareholders to the position they were in before the transaction that it believes sealed the company's fate.

Goldstein concluded with a stark warning intended to resonate beyond ICMB's shareholder base. “Should Investcorp fail to take responsibility for the collapse of ICMB, that should serve as a warning to other clients and potential clients of Investcorp that any assurance of ‘putting our clients’ interests first’ is just meaningless verbiage.”