Client is an acquisitive Healthcare HoldCo buying urgent and wound care clinics. Their strategy has been that of inorganic growth: find smaller competitors, acquire them, optimize the companies, and capture the upside with economies of scale. However, for their most recent acquisition, the client was short the required downpayment. Without being able to come up with the equity portion of the funds, the client would lose the entire opportunity.
That’s where Capital Desk came into play.
- Secured $5M in 8 business days, behind senior creditor
- Sales based financing, based on cash flow history and combined sales of the suitor and the target companies.
- Non-dilutive capital where returns are asymmetrical to fees (acquiring sales/profits for life)
Because Senior Creditor did not allow for a signed intercreditor, we settled on not filing a UCC-9 lien on the assets of the business. This provided the company with a risk-free option to the managers of the business who collectively were still a minority of the company.
- Client used the $5M into a newly held business asset without having to put up more capital
- Client inorganically acquired new revenue.
- Client was able to preserve their war chest and didn’t have to put additional mone in the transaction
- Client continues to seek new targets knowing they have access to fast capital.
