Golub Capital BDC, Inc. (NASDAQ:GBDC) Q4 2023 Earnings Call Transcript

Ryan Lynch: Got it. Okay. Just the last question I had was, you and others have talked about, kind of seeing a little bit of green shoots and maybe a pickup in activity. In order for that activity, you’re talking about maybe a little bit of a rebound now and into the year-end and then potentially a bigger pickup in activity into 2024. I’m just curious, in order for that deal activity to actually cross the finish line and come to fruition, do you get the sense that market conditions just have to sort of stay the same and stabilize right around here or does anything have to change like a cut in base rate, a much stronger sort of growing economy? Or do you think if we just kind of stabilize right around these sort of levels from an economic standpoint, do you think that you’ll continue to see a big uptick in deals crossing the finish line at 2024?

David Golub: I think the things that reduce uncertainty would help. So, by way of example, if we get more data suggesting that the economy is continuing to grow, that inflation is continuing to grind lower, that would be helpful. If we got internationally, some good news in respect of the two wars that are underway, that would be helpful. I think the biggest obstacle right now to seeing a significant rebound, a significant and sustained rebound in deal activity, is the level of uncertainty out there. Having said that, I think we’ve had a fair bit of time go by since June ’22, when the M&A environment took a sudden slowdown in the context of higher rates and the swoons in both equity and credit markets. And I think that’s helped a lot in recalibrating valuation, and expectations on the part of both buyers and sellers. There’s still in many cases a gap, but I think that gap has narrowed, and I think continued reduction in uncertainty would help in further narrowing.

Ryan Lynch: Okay. Understood. That’s all for me today. I appreciate the time.

David Golub: Thanks, Ryan.

Operator: There are no further questions at this time. I will turn the call back to Mr. David Golub for closing remarks.

David Golub: Well, thank you all for giving us a bit of your time today. I hope you found this call helpful. We look forward to talking to you next quarter. And as always, if you have any questions in the interim, please feel free to reach out. Have a great Thanksgiving everybody.

Operator: This concludes today’s conference call. We thank you for joining. You may now disconnect your lines.