Daily News: August 8, 2013

GE Capital Breaks New Ground in Japanese ABL Market

GE Capital said it has signed an agreement with Imation Corporation Japan, a subsidiary of Imation Corp, a global scalable storage and data security company, headquartered in Oakdale, MN to provide up to two billion yen (approximately US$20 million) of revolving credit facility in Japan.

GE Capital said the facility will act as a liquidity line, and given the line is Japan based and yen denominated, it also adds flexibility to Imation’s global treasury needs. The facility includes an accordion feature which allows the facility to be increased to three billion yen at Imation’s request. No immediate borrowing is anticipated.

Asset-based lending is a relatively new form of corporate funding in Japan, where lenders typically only lend on hard assets, such as equipment and real estate, GE capital said.

Danny Zheng, treasurer of Imation, said, “It has been a great pleasure working with the dedicated GE Capital Japan team. Their experience in the international asset based lending marketplace and focus on finding solutions for multi-national companies was a major factor leading to a seamless closing. We look forward to working with GE Capital and strengthening our relationship going forward.”

Clark D. Griffith, managing director of Structured Finance of GE Capital Japan, said, “We are pleased and excited to provide this asset based credit facility to Imation and we look forward to supporting them as they achieve their strategic goals globally. GE Capital is one of the major providers of asset based loans in the world, and this deal shows our global ABL underwriting capability leveraging our worldwide network to provide global financial solutions and support the financial needs of global companies with multinational operations like Imation. GE Capital plans to grow its asset based loan business in Japan and Asia Pacific.”

“GE Capital’s international footprint creates a capability to lend on cross-border collateral, which thus allows for multi-jurisdiction ABL. Normally, assets that are outside the country, or legal jurisdiction, where the ABL is underwritten are considered ineligible as collateral because lenders cannot perfect, or lay claim to assets outside the immediate legal jurisdiction. GE Capital’s global offices make the appraisal and securing of overseas collateral possible, allowing more ABL borrowing capacity for multi-national corporations.”