CASE STUDY
Receivables Financing
Receivables-based ABL Closed With Non Bank Lender
Borrower seeks increased capacity to grow a portfolio of B2C receivables
- Challenge
Our borrower had a shorter operation history and reinvested all profits in growth initiatives that are not capitalized on the balance sheet limited the creation of book equity value. Many lenders perceived this as a challenge and preferred to be paired with a dilutive round of new equity as a condition for funding incremental capacity.
- Cerebro Solution
Cerebro was able to identify a non-bank, specialty finance lender with a deep knowledge of consumer receivable financing. Our lender understood the value of the underlying portfolio performance as the best indicator of credit risk. With our Borrower demonstrating strong performance on their assets, the reinvestment of profits to further growth were received more positively. With this structure, the Borrower has the debt capacity required to double their business over the life of the loan.
Winning Term Sheet
- $45MM Incremental senior secured revolving loan
- LIBOR + 6.25% (1.50% floor, subject to unused fee (0.50% - 0.75% annually) depending on usage)
- Advance Rate: 80% of eligible consumer receivables, with an automatic increase to 85% upon achieving certain performance statistics
- Term Structure: 3 years, Subject to 24 month draw period, declining prepayment penalties over life of loan
Ready to get started?
Join the thousands of mid-sized companies who have used Cerebro.
Featured in
- info@cerebrocapital.com
-
12 W Madison St.
Baltimore, MD 21201 - Cerebro Capital
- @cerebrocapital