FS Specialty Lending Fund (FS Energy & Power Fund) IPO Update

FS Specialty Lending Fund(FSSL): Lawsuits Investigation Update

The White Law Group continues to investigate the liability that brokerage firms may have for unsuitably recommending FS Specialty Lending Fund to investors. 

FS Specialty Lending Fund (FSSL) Advances Toward NYSE Listing

FS Specialty Lending Fund, formerly known as FS Energy and Power Fund, has completed its reorganization from a non-traded business development company into a registered closed-end fund under the Investment Company Act of 1940. The conversion involved a merger into a new entity, now renamed FS Specialty Lending Fund.

The fund plans to list on the New York Stock Exchange (NYSE) under the ticker FSSL by mid-November 2025, although the timing depends on market conditions and board approval. Until then, it will operate as an unlisted closed-end fund.

To meet NYSE listing standards, the fund executed a 1-for-6 reverse stock split in May 2025, increasing its NAV per share. The fund also plans to lower its management and incentive fees post-listing and deliver enhanced quarterly distributions for Q2 and Q3 2025, followed by a 9–9.5% annualized distribution rate in Q4. Monthly distributions are expected by January 2026.

Reverse Stock Split – Bad News for Investors? 

Reverse stock splits can create the illusion of higher share prices, but they often signal financial distress and may lead to decreased investor confidence, potentially driving the stock’s value down over time. Unfortunately for investors, FSEP’s NAV per share is currently $3.30 per share as of December 31, 2024.  Shares were originally offered for $10.00 per share. According to Lodas Markets, a secondary market for alternative investments, shares of FSEP were recently sold for just $2.30 per share. 

The fund reportedly has a total cumulative return of -14.86% since inception. 

The White Law Group has represented numerous investors in claims against their brokerage firms to recover losses in alternative investments such as FSEP. 

The trouble with business development companies is that they involve a high degree of risk. They are typically sold as unregistered securities which lack the same regulatory oversight as more traditional investment products like stocks or bonds.

Broker dealers that sell alternative investments are required to perform adequate due diligence on all investment recommendations. They must ensure that each investment recommendation that is made is suitable for the investor considering the investor’s age, risk tolerance, net worth, financial needs, and investment experience.   

FINRA Lawsuits to Recover Investment Losses  

 If you suffered losses investing with your financial advisor or broker, you may have recovery options by filing a FINRA Dispute Resolution Claim.  

FINRA Dispute Resolution is an arbitration venue for investors with claims against their brokerage firm or financial professional.  It provides investors with an opportunity to attempt to recoup their investment losses — an alternative to filing such claims in court.     

Lawsuit Options: Individual FINRA Arbitration vs. Class Action

If you suffered losses with your financial advisor you may have two main legal paths:

• FINRA Arbitration: Best suited for investors with significant losses, typically over $100,000.
• Class Action Lawsuit: More appropriate for multiple investors with smaller claims that may not justify individual litigation.

If you have suffered investment losses in FS Specialty Lending Fund (FS Energy & Power Fund), the White Law Group may be able to help you. Please call the offices at 888-637-5510 for a free consultation.   

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm dedicated to helping investors in claims in all 50 states against their financial professional or brokerage firm. Since the firm launched in 2010, it has handled over 800 FINRA arbitration cases.    Our attorneys have recovered millions of dollars from many brokerage firms in the past.  The firm works on a contingency fee basis to help you in your time of need.