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SG Credit Partners Provides $2MM Second Lien Growth Capital to Staffing Firm

May 09, 2019, 08:55 AM
Filed Under: Staffing Services

SG Credit Partners provided $2 million in second lien growth capital to a founder-owned staffing company that provides a full suite of employment solutions to IT, life sciences, and business services clients.

The Company had realized strong revenue growth over the last few years and had a strong pipeline for continued growth. The Company’s bank, Wells Fargo Capital Finance, was in the process of increasing its revolving LOC facility to scale with business growth and wanted subordinated capital to provide liquidity cushion. Additionally, the principals of the Company were sensitive to dilution and wanted a solution without a warrant / equity requirement.

SG Credit Partners was able to get comfortable with the business due to its strong client base consisting of large fortune 1000 clients, historical profitability, strong growth trend, and a robust pipeline of new business. SG Credit Partners provided a non-dilutive $2.0MM loan behind Wells Fargo with structured amortization to provide flexibility around the Company’s projected cash flow. The transaction closed within three weeks and Wells Fargo successfully increased their AR facility.

SG Credit Partners’ second lien (subordinated) loans can help senior lenders close deals (onboard new clients), offer a liquidity solution when unable to lend up (retain existing clients), and/or solve out-of-formula / technical default issues.

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