Business development company Fifth Street Finance Corp said it began a public offering of 4 million common shares and expects to use most of the proceeds to make investments in small and mid-sized companies.

Shares of Fifth Street fell 4.3 percent to $10.69 in trading after the bell. They closed at $11.17 Monday on the New York Stock Exchange.

The company intends to grant the underwriters an option to purchase up to an additional 600,000 shares to cover over-allotments.

Wells Fargo Securities and UBS Investment Bank are the joint book-running managers for the offering, the company said in a statement.

(Reporting by Archana Shankar in Bangalore; Editing by Anil D'Silva)

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