Celtic Capital’s Deal Sparked Interest From Electrical Testing Device Company
The Company
This company is a California-based distributor of contract manufactured electrical testing devices. One of the owners is local, the other is based overseas. There was a third minority owner/operator, but when he had a falling out with the other owners, a new manager was brought in to run things.
The Situation
With a vision in 2017 to use the latest technology, the Company ramped up R&D and brought in new staff. When the anticipated expansion and increase in sales didn’t materialize, the Company suffered losses. At that point, its bank was unwilling to renew the Company’s credit facility and the deal was referred to Celtic Capital.
The Solution
Celtic Capital provided a $3,500,000 Accounts Receivable Line of Credit and a $250,000 Inventory Line of Credit to take out the bank-owned asset based lender’s smaller credit facility and to help with the Company’s growth plans. Additionally, the Company changed a key manager and lowered expenses so that volume would be more in line with prior years.
The Result
The Company has been profitable since August but where the Company goes from a sales standpoint is still unclear. Projections show a modest increase in sales in 2020 which is fine with management if the Company remains profitable.
About Celtic Capital
Companies looking for working capital to cover operating expenses, fund growth, increase buying power and take advantage of vendor discounts and rebates turn to Celtic Capital. With an appetite for the more complex transactions, Celtic Capital has a history of success in crafting creative, flexible asset based financing solutions from $500,000 to $5 million with no financial covenants.
As an independent lender, working with companies nationwide, Celtic Capital is willing and able to alter price and deal structure and expand lines of credit to handle its clients’ increased revenues; and when cash flow is an issue, will look toward providing an inventory facility to help offset lost cash flow.
If you know of, or are, a business in need of non-traditional financing, contact Mark Hafner at 800.742.0733 or mhafner@celticcapital.com, or visit us at www.celticcapital.com.