The Situation and Challenge
Check out the details on our most recent funding for a foreign-owned US subsidiary manufacturing company:
Upon learning its current bank-owned factoring company had sold, the foreign-owned US subsidiary operating as a Tier 1 Auto Parts Manufacturer was told to find a new factor. As a rapidly growing manufacturing business doing $50MM in revenue, the prospect was a perfect match for Porter Capital’s funding capabilities.
Engaged by the banking officer to refinance the relationship, Porter extended an $8.5MM credit facility to provide enough availability to take out the existing lender and give the client room to grow and expand operations.
85% of the client’s revenue comes from parts sold to Audi, BMW, and Daimler. Porter Capital is not overly concerned when it comes to a client’s revenue being concentrated among three customers. We were challenged by our inability to obtain a personal or valid guarantee due to foreign ownership. Fortunately, our credit committee gained comfort with a corporate guarantee given its track record with customers.
With its current production facility at roughly 200,000 square feet, the manufacturer is in the process of adding an additional 150,000 square feet to keep up with demand. The semiconductor shortage caused revenue to dip; however, the company is forging full speed ahead.
Porter’s credit facility allows the client to capitalize on the business without giving up equity and increase revenue without being subjected to restrictive financial covenants.
We are proud to support and add another client to our portfolio at Porter Capital. Manufacturing businesses in high-growth mode are a perfect fit for Factoring.
We Can Help Fund Your Business Growth
If you are a business owner looking for working capital, invoice factoring, or have found yourself in a situation similar to the client in this story, please visit our Apply Page or give us a call at 1-800-737-7344. If you are a broker looking for solutions to meet the needs of prospects who do not qualify for traditional financing, you can submit a referral for review on our Partner Page or give us a call at 205-322-5442. Our team would love to discuss your needs and which of our financial solutions best fits your business needs.