The Company
A Pacific-based manufacturer specializing in precision metal stamping and sheet metal fabrication, serving customers who require consistent quality and reliable production capabilities.
The Situation
The Company faced an unsustainable debt structure that ultimately led to an Article 9 asset sale. The lender foreclosed on the business assets and engaged a third party to identify a buyer capable of acquiring and operating the Company as a going concern.
The Solution
A qualified buyer was identified, and the acquisition was structured with no out-of-pocket cash required from the buyer. The seller was kept on to run the Company day-to-day. Although the bank owed more than the asset value, a portion of the debt was satisfied through separate real estate proceeds. Celtic Capital, referred by a trusted referral partner, then came in and structured a custom financing package totaling $804,500 to pay off the bank, which included a:
- $500,000 Accounts Receivable Line of Credit
- $304,500 Equipment Loan
Close collaboration between the buyer and seller helped ensure a timely and successful closing.
The Result
The acquisition was completed successfully, and the Company emerged free of legacy debt, creating a stronger foundation for future operations. However, a continuing challenge has been the seller’s limited understanding of how the financing structure works, which is compounded by the absence of in-house accounting expertise.
Based on extensive experience, Celtic Capital has found that self-teaching accounting functions is rarely effective over the long term. While Celtic Capital has provided hands-on guidance and ongoing support as it does for all clients, when needed, its approach is also not a permanent solution. As a result, the Company is now in the process of hiring a dedicated accounting professional to strengthen internal financial management and reporting.
With the debt burden eliminated, the expectation is that going forward, the business should be immediately profitable. Whether that potential is fully realized will depend on disciplined financial oversight and operational execution. buyer groups, the Company is positioned to double revenue in 2026.
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 more complex transactions, Celtic Capital has a history of success in crafting creative, flexible asset-based financing solutions from $500,000 to $8 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 celticcapital.com.