Celtic Capital Creates a Full Financing Solution for CA Manufacturer
The Company
The Company is a California-based manufacturer of various real food products sourced from ethically grown super foods from around the world.
The Situation
Due to covenant violations, the Company was asked out by its bank. The intermediary helping the Company find new financing realized that because the A/R and inventory borrowings were relatively equal, it would be especially challenging to find an asset based lender to be as aggressive on the inventory as was needed.
The Solution
Two separate lenders were brought in – Celtic Capital to finance the A/R, and an inventory lender to finance the inventory. When the appraisal on the inventory came up short for what was needed to pay off the bank, Mark Hafner, Celtic Capital’s President and CEO, suggested an equipment loan to satisfy the shortfall. Mark had an appraisal of the equipment completed the next day and the addition of an equipment loan to the mix bridged the gap needed to pay off the bank. Celtic Capital provided a $2,250,000 Accounts Receivable Line of Credit and an Equipment Loan for $376,500. Those facilities in conjunction with the inventory lender’s $2,000,000 Inventory Line of Credit provided the Company with a full financing solution.
The Result
The Company is expecting business to increase in 2022. That, combined with the operational changes and an injection of capital by the owner, should bring the Company back to profitability relatively soon. The owner is excited about the business’ future prospects.
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.