No Capital, No Growth
The Company
This is a Washington-based distributor of solar equipment and hardware.
The Situation
All of the equipment and hardware is manufactured in China by an affiliated company. The affiliate also provided the necessary financing. Maxed out on the financing and with huge payables that needed to be paid down in order to grow the Company, the owner went to a local bank for capital. The bank turned him down as the Company’s financials didn’t meet the bank’s lending criteria. The banker, a long-standing referral partner, referred the owner to Celtic Capital.
The Solution
The Company came to us with strong sales but no capital to keep the flow of goods coming in from China. It had a concentration issue and an EIDL. Given both of those issues, at first glance, it didn’t look like there would be enough availability for a deal that made sense. But Celtic Capital’s ability to subordinate EIDL, made all the difference. After a successful subordination with the SBA, we provided the Company with a $900,000 Accounts Receivable Line of Credit and a $300,000 Inventory Line of Credit.
The Result
We worked through the challenges to come up with a deal that satisfied this Company’s cash needs. Sales stayed strong during the deal process, and our financing will enable the Company to continue to grow.
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.