The Company
Founded in 2012, this Pacific Northwest-based company is a premier provider of vehicle transportation and logistics services. The Company specializes in moving vehicle fleets for a diverse range of customers; most recently, supporting the transportation needs associated with World Cup events.
The Situation
The owners (husband and wife) needed to replace some high-cost debt. They had a line of credit and equipment loan with a local bank along with a high-priced Merchant Cash Advance (MCA) loan. Initially, the bank only wanted out of the equipment debt but subsequently decided it wanted a full payoff of all outstanding debt. A trusted intermediary referred the Company to Celtic Capital for the best way out.
The Solution
Celtic Capital evaluated the Company’s equipment and receivables and worked through the capital structure to identify a solution. An equipment appraisal confirmed that there was equity in those assets; however, the available equipment value alone was not sufficient to satisfy all of the Company’s obligations. The owners contributed additional personal funds to help bridge the gap, and Celtic Capital provided a $1,000,000 Accounts Receivable Line of Credit and a $491,200 Equipment Loan, which enabled the Company to:
- Pay off the bank in full.
- Eliminate the MCA debt.
- Establish a more flexible working-capital structure.
- Maintain liquidity to support ongoing operations and future growth.
The Result
With its expensive debt eliminated and a new source of working capital in place, the Company is positioned for its next phase of growth. The Company is actively adding rental car companies and pursuing other high-volume transportation opportunities, including business tied to the upcoming Olympic Games and other major events. With new customers coming on board and revenue expected to increase, the Company now has the financial flexibility to capitalize on opportunities that might otherwise have been constrained by its previous debt structure.
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.