Case Study

Acquisition Financing

Independent Sponsor Secures Acquisition Financing

$5MM acquisition financing features compelling 3 years interest only key deal term

Our borrower was an Independent Sponsor seeking debt capital to fund the leveraged acquisition of their fourth portfolio company. The borrower faced several challenges to secure acquisition financing.

  • A new industry target compared to all previous acquisitions
  • High amount of key man risk related to the seller/founder as the business was achieving a breakthrough in customer growth
  • Near minimum revenue and adjusted EBITDA metrics for many non-bank cash flow lenders
  • Borrower required a non-recourse lending solution given the passive nature of the committed LP equity investors

While the borrower maintained a lender network through their previous and current private equity activities, they used Cerebro to run a data driven process across a wider and deeper lender pool to eliminate financing search and execution risks as well as leverage their time for diligence and investment related processes. Cerebro also helped the borrower secure 3 years of interest only financing and saved the borrower 5 percentage points on their interest rate compared to the next best option available to the company. 

Winning Term Sheet

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