SOME NOTABLE TRANSACTIONS INCLUDE:
SUCCESSFUL BUSINESS ACQUISITION AND REFINANCING
The partner of a successful IT consulting business, asked us for assistance to enable the buy out of his 50% partner. This required funding of $1M plus refinancing of a number of property loans. The transaction also needed to settle by 31/12/2020.
Working with the client, we undertook detailed analysis of the business and constructed a detailed Information Memorandum which highlighted the cash flow generation of the business and the ability of the borrower to service the increased debt load. Significantly, the borrower did not have sufficient equity in bricks and mortar security to provide full cover for the new facilities. Despite this, we secured very competitive terms, over a long tenor and attractive pricing, despite the large component of goodwill lending. The selected lender was able to recognise the sustainability in business revenues, quality of management and provided well structured facilities that smoothed out repayments to suit cash flow.
With a number of facilities to refinance with different lenders by 31/12/2020, we liaised with all parties to ensure completion by that date.
SALE AND LEASEBACK OF MINING EQUIPMENT
Working with the corporate adviser of this mid cap Australian gold miner, we sourced asset finance for the sale and leaseback of refurbished mining equipment worth several million dollars. This allowed the release of significant equity back to the client and reflected the ability to source competitive financing options, even in a COVID-19 environment. C4 Capital's access to asset finance lenders through its broker accreditation, provided direct funding options not otherwise available to the client. The funding allows the company to continue to aggressively pursue their growing resource base opportunities.
COMMERCIAL OFFICE FIT OUTS
Our client sought to buy out their partner from an existing, well established business. There were a number of complex facets to the transaction which did not make it straightforward. Eventually though, working closely with the client and their accountants, we were successful in securing both a large acquisition facility from their existing lender, tailored to their cash flows and also a large surety bond facility, which allows them to compete for additional projects, without being constrained by their existing bank security capacity.
HEALTHCARE - PHYSIOTHERAPY
We assisted two new physiotherapy clients with the refinancing of existing property and business debt and the acquisition of a new house all in the one transaction, totalling almost $4M in facilities. With 5 separate practices, different borrowers and properties, plus the new acquisition, this was quite a complicated transaction, with a tight deadline. Ultimately, the client received a great deal from a new lender, which highlighted the fact that the existing bank had been providing business and home loan facilities that were priced well above market. A great saving and better structure for the client, also partnering them with a very competent and proactive new banker specialising in healthcare. This process highlighted the fact that as a business owner, your banker as a major service provider and your cost of capital, should be benchmarked on a regular basis, to ensure you are optimising your financial arrangements.
RENT TO BUY FACILITY
Our client was seeking to establish a new line of business, where they would rent their unique product to their clients, on a rent to buy arrangement. This created issues around funding the working capital component of the equipment, before payback over the rent period. Working with our client, we refined the economics and structure and put together a presentation outlining the opportunity to various lenders. In the end we secured an approval from a non existing relationship lender, that understood the business model and strategy.
SUCCESSFUL MANUFACTURING COMPANY REFINANCING
C4|Capital completes successful refinancing for a new client, through its finance broking services joint venture with MVP Financial.
This long established and successful manufacturer of niche industrial conveying solutions, was seeking increased debt facilities to finance its expansion plans due to continued business growth. Despite having a longstanding relationship with its existing bank, the bank was only prepared to increase its funding by a small amount linked to the value of existing plant and equipment. After reviewing the company’s financial position and conducting due diligence on the business, it became obvious that the firm had substantial cash flow generating capacity, was well managed and had a clear growth strategy which had not been adequately recognised by the lender.
Together with the company, C4|Capital prepared a detailed information memorandum with a proposed financing structure, inviting prospective lenders to submit funding proposals. A number of highly attractive offers were received, with the end result that the company refinanced with a new lender, on improved security, pricing and tenor terms. The company is now able to pursue its growth strategy, unfettered by its lending facilities, which provide substantial flexibility to manage cash flows during this important phase.
The refinancing exercise highlighted the benefits of having an independent review of a business’s financing structure, followed by a competitive financing process with a clear understanding of management’s strategy.