Vol. 3 No. 7
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July / August 2005
2005 Executive Roundtable
Lenders Keep Pace As Competition Stiffens
2005 ABF Executive Roundtable: Good Times Keep Rolling
in Spite of Aggressive New Players, Savvier Borrowers
By Kevin Riordan, ABF Journal Freelance Writer
Executives of 16 of the nation’s top asset-based lending firms agree: 2004 was better than 2003. And, for the most part, they view ’05 as so far, so good with the good times rolling into next year. But they also say competition is tough and getting tougher as aggressive new players and ever-savvier borrowers alter the very nature of the ABL business.(Ref # IND063)
The Small- to Mid-Market Sector: Business Remains Strong While Competition Stiffens
By Susan Carol, ABF Journal Freelance Writer
As part of this year’s mid-year “state of the industry” issue, ABF Journal thought it would be interesting to speak with executives of asset-based finance companies primarily doing transactions under $10 million. These industry leaders in the small- to mid-market sector had a lot to say on topics ranging from new competitive forces to current challenges in maintaining and growing their businesses.
(Ref # IND064, MYS004)
Too Much Money,Too Few Deals…
For Middle-Market Mergers & Acquisitions, It’s a Seller’s Market
By Charles Collie, SVP & Regional Manager, PNC Business Credit and Joseph F. Dempsey Jr., EVP & Manager, Capital Markets
Recently, trends in the mergers-and-acquisitions market have become clear: Both lenders and equity groups are struggling to deploy steadily rising assets into a relatively static universe of middle-market companies, and, as a consequence, profit margins are narrowing. The end result? It has become an opportune time for middle-market firms to bring their firms to market or consider a sale of their business.
(Ref # MERG002)
Hedge Funds Fill the Void With a Flexible, Non-Traditional Approach
By Warren H. Feder, Partner, Carl Marks Advisory
While hedge funds certainly are not new in the U.S., a recent surge in hedge fund lending has created a relatively new dynamic in the financing arena – one where hedge funds are playing roles traditionally filled by asset-based lenders. However, recent deals such as the $225 million financing to Krispy Kreme obtained through CSFB and Silver Point Finance illustrate traditional lenders and hedge funds can share a seat at the same table.
(Ref # IND065)
Preempting the Next Downturn:Fundamental Measures CFOs Can Employ Now
By Joseph P. Powers, SVP, Bank of America Business Capital
Analysts predict that the next market downturn is just a year or two away. While no one can predict when a downturn might occur, its arrival is inevitable. Are borrowers prepared? CEOs and CFOs can institute a number of preemptive measures to help their companies prepare for and weather the storm.
(Ref # IND066)
Inside Quick Turnaround Financing Deals:
Survival of the Fittest & Fastest!
By Stephen Klein, Managing Director, Business Credit Services Group
In today’s volatile global economy, Darwin’s axiom requires an addendum: Survival of the fittest and the fastest. Middle-market companies must be especially nimble and quick-footed since unexpected moves by competitors, suppliers, customers and financing sources can suddenly put their businesses in immediate jeopardy. As in many sports, speed can be the decisive factor in separating the winners from the runners-up.
(Ref # TM039)
Potential Deal-Killers… Two Tales of Remorse
By James Fox, Staff Member, Executive Sounding Board Associates
For companies in the zone of or emerging from bankruptcy, history provides two lessons for debtors pursuing an M&A transaction: Time is not a friend, and those “going it alone” without an experienced M&A professional often end up regretting it. The following two case studies (whose facts have been somewhat altered for confidentiality purposes) illustrate these lessons.
(Ref # TM040)
Heading Out of the Tunnel in 2005… The State of Non-Traditional Factoring
By Thomas G. Siska., Managing Director, FactorHelp.com
When we last communicated about the recourse factoring industry’s journey, we were still in a dark tunnel. There appeared to be some light ahead, but the source of the light was uncertain and the general consensus was that times were tough. Although things haven’t changed much, there is some good news as executives have learned to cope with the challenges and grow their businesses in spite of it all.
(Ref # FAC047)
PUTTING IT TOGETHER
AGS Automotive Systems’ Restructuring: A Winning Partnership
By Kathryn Williams, Team Leader, GMAC Commercial Finance
When AGS Automotive Systems, an established automotive supplier,was struggling to recover from bankruptcy in the midst of an industry downturn, GMACCommercial Finance provided thefinancing necessary for the operation to restructure and revitalize itself.
(Ref # DLS015)
New Bankruptcy Code Amendments:
Major Changes Shift Leverage In Favor of Special Interests (Part I)
By Peter J. Antoszyk, Partner, Brown Rudnick Berlack Israels and Jay R. Indyke, Partner, Kronish Lieb Weiner & Hellman
On April 20, 2005, President Bush signed the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 into law, which amends the United States Bankruptcy Code. While much of the publicity concerning the Act dwelled on the provisions affecting individuals seeking relief under Chapter 7, it also contains a number of provisions that will significantly impact corporate insolvencies. This is the first part of a two-part series. Part II will appear in the September 2005 issue of ABF Journal.
(Ref # BANK013)
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