A Deal With an Unusual Funding Twist
The Company
This Company is an Indiana-based producer of specialty chemicals. It’s majority owned by members of an equity group.
The Situation
Plagued by the pandemic, supply chain disruptions and inflation, all of which impacted the business’s profitability; the Company suffered losses. Upon becoming out of covenant with its bank, management was asked to find a new source of financing.
The Solution
Celtic Capital, upon being asked to replace the Company’s existing bank line, provided a $750,000 Accounts Receivable Line of Credit and a $150,000 Inventory Line of Credit. Interestingly, and quite unusual, the equity group paid off the bank and once our financing funded, we paid back the equity group.
In addition to replacing the bank’s financing, our facility provides the working capital management needs to help effectuate its turnaround plan.
The Result
With pandemic-related problems in the rear-view mirror, management’s projections for this year show a 50% increase in revenue over last year’s results. Celtic Capital gave the Company the ability to finance that growth and management brought in someone experienced in their market who already has brought in some new customer relationships. The future for this Company looks bright.
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.