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King Trade Capital Provides $500,000 in Successful Turnaround

November 10, 2014, 07:21 AM

King Trade Capital announced a $500,000 production facility for a government contractor.  A former client of King Trade Capital (KTC) recently completed a restructuring of its balance sheet by infusing equity into the company through a preferred stock offering. The new investor group appointed a turnaround consultant who previously worked for the client and is well known by KTC.  When KTC learned about the recapitalization, they reached out to the turnaround consultant, now CEO of the company, to learn more.

Due to its poor performance prior to the recap, the company had exhausted access to all traditional forms of financing. Although the company was cash flush due to the equity raise, the CEO wanted to accomplish two things following completion of the initial turnaround initiatives, (i) rebuild the company’s credit by establishing a relationship with a finance company and (ii) increase the availability of credit to support the return of capital to the equity investors.

KTC had a unique idea and structured a solution aligned with the CEO’s goals. Since the company is currently sitting on an order backlog that should provide more than $1 million of positive cash flow following fulfillment, KTC proposed a production finance facility that will allow the company to return capital to its investors, accelerating returns, and maintain the ability to execute upon their growing contract backlog. This is another example of how KTC’s unique tailored solutions can be used as a tool to fix a problem, in this case expediting the return of equity to investors while helping rebuild the credit of the company.

King Trade Capital is the country's oldest and largest independent and contract finance for small to middle-market companies in the U.S., UK and Canada. Since 1993 KTC has provided more than $1.5 billion of capital in over 300 public and private companies worldwide.

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