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Republic Provides a $4.5MM ABL Facility with Equity Sponsor

March 13, 2020, 09:05 AM
Filed Under: Private Equity

When a private equity group needed a debt partner that combined industry knowledge with dynamic execution, they choose Republic Business Credit’s West Coast team to complete the leveraged buyout of the food manufacturer. 

Republic prides itself by supporting profitable, growth orientated businesses in addition to distressed companies under its platform.  Republic provides Asset Based Loans, E-Commerce & Direct to Consumer loans into growth companies, while favoring its Ledgered Line of Credit and Factoring solutions for challenged, distressed or bespoke situations. Republic expanded its ABL team last year, with the additions of Matthew Begley as Chief Operating Officer, and Jason Carmon as EVP, Western Regional Manager. 

The facility was provided to a California based natural food manufacturing company.  The company sells into Whole Foods, Sprouts and several boutique stores across California.  The private equity sponsor originally acquired the company through a leveraged buyout of a distressed company.  The product category, management team and significantly reduced price made it a rare opportunity to complement their portfolio of companies.  Republic partnered with the equity sponsor to provide an asset based loan in less than thirty days.   

Republic Business Credit provided a $4.5 million Asset Based Loan with an accordion up to $7 million in order to support the company’s projected growth.  In addition to the revolver, Republic structured a $3 million equipment term loan that leveraged their existing manufacturing equipment and a $1 million sublimit for new capital expenditures. 

Republic’s COO, Matthew Begley says, “We are excited to partner with the management team and the private equity fund to support the manufacturers growth in the food space.”  Republic’s initial funding provided for the necessary runway to implement the full turnaround plan while reducing the size of the check the fund needed to close the transaction.  After just a few months since commencing their facility with Republic, the company is on pace to be cashflow positive for all of 2020. 

“Republic is a proud supporter of the manufacturing industry and relieved to see about 22,000 jobs were created per month in 2018, nearly 500,000 in the past 30 months alone according to a recent Forbes article”, says Robert Meyers, President of Republic, “Manufactures often turn to Republic over the cumbersome SBA 504 or SBA 7A Loan process, ideally, if time permits the entrepreneur can even utilize both.” Republic designed its team, products and locations to support the largest number of smaller and medium-sized businesses in the US.   

Republic Business Credit partners with private equity firms, banks, accountants, sponsors, lawyers and investment banks to collaboratively support entrepreneurs across the United States, to create value, by enabling them to focus on growing successful businesses.

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