Daily News: March 30, 2015

Austin Financial, Diamond Creek Capital Launch ABL

Austin Financial Services and Diamond Creek Capital (DCC) announced the formation of a strategic alliance. The alliance of DCC, a special situations cash-flow and enterprise value lender, and Austin, a privately funded asset-based lender, will provide the market a single source financing solution for growth capital, acquisitions, recapitalizations and turnarounds.

Together, DCC and Austin will address a void in the lower middle market by providing a cost-competitive, unitranche debt facility to smaller companies who historically have not had access to financing beyond traditional bank and asset-based lending facilities.

DCC has formed Diamond Creek Management to act as the asset manager of both funds, overseeing the marketing, operations and portfolio management of the combined loan portfolio of ~$110 million. Headquartered in Orange County, CA, DCC will also take space in Austin’s office in Los Angeles, with the intention of growing the combined portfolio to over $250 million.

“This alliance is the next step in the development of Diamond Creek, and we expect Ben to play an integral role in the future growth of our company.”

As part of the aforementioned alliance, DCC is expanding its team with the addition of Benjamin Frank as a Partner of the firm. Ben has more than a decade of experience in the banking and commercial finance industry, with considerable strength in lending, underwriting, financial modeling, risk assessment and contract negotiations. Frank will hold the position of chief executive officer at Austin and oversee its day-to-day operations, while sourcing opportunities for both Austin and DCC.

Frank has spent the majority of his career in commercial banking, working for Sunwest Bank. At Sunwest, Frank held the position of executive vice president and chief lending officer. During his seven year tenure with Sunwest Bank, Mr. Frank was an integral part in the growth and development of the Bank’s lending platform.

In addition, Frank headed up the bank’s structured finance lending practice, focusing on highly structured, asset-based and cash flow transactions for private equity groups and family offices with $100 million to $1 billion in assets under management. He was involved at all levels of the organization from credit underwriting to board level approvals. As the chief lending officer, Frank was responsible for overseeing all of the lending processes and procedures for the bank.

Diamond Creek Capital was founded in October 2005 to opportunistically provide creative financing solutions to underserved lower middle market businesses. DCC provides individually tailored financing solutions to lower middle market companies who fall just outside traditional bank lending parameters and/or do not meet the formula restrictions of most asset based lenders. DCC has funded 49 deals with $201 million in total commitments over its 10-year history. DCC’s current portfolio is comprised of 15 loans aggregating over $70 million in gross commitments. DCC’s nationwide platform services a broad range of industries with a focus on investments ranging from $1-20 million, for companies with $1-10 million of EBITDA and/or an enterprise value greater than $5 million.

Since 1981, Austin has been providing asset-based loans for small and medium sized companies throughout the Western United States. Austin’s financing solutions include revolving lines of credit structured against accounts receivable and inventory, as well as term loans collateralized by equipment. With a focus on manufacturers, wholesalers, distributors and service providers, Austin offers loans ranging from $500,000 to $6 million. Austin is an independent, non-bank owned Commercial Finance Company which allows Austin to provide flexible and creative financing solutions without the customary stringent financial covenants and structural requirements imposed by banks.