American Capital Commits $50 Million to First Capital
Tuesday, October 31, 2006
American Capital Strategies announced it has provided financing of up to $50 million to support the growth of First Capital, a provider of secured, working capital financing for middle-market companies. American Capital's investment takes the form of senior subordinated debt.
"We are very pleased to be investing in First Capital, a fast-growing provider of secured working capital financing for middle-market companies that is led by a distinguished management team with decades of experience in the financial services sector," said Bob Grunewald, American Capital managing director of the Financial Services Group. "First Capital's loan portfolio has grown rapidly while maintaining a culture focused on credit quality and earning a reputation for first-class service. We are uniquely positioned to bring strategic benefits as well as debt and equity capital to our financial service investments and we look forward to working closely with First Capital as they continue to grow."
"First Capital is the first investment by our Financial Services Group, which was formed in May of this year," said John Erickson American Capital chief financial officer. "The Financial Services Group targets investments in middle-market companies involved in consumer and commercial finance, insurance and asset management and companies providing products or services to these companies and First Capital perfectly fits the profile. Our Financial Services Group has generated a tremendous flow of opportunities and is taking advantage of American Capital's expertise in both middle market credit and structured finance."
First Capital focuses primarily on providing traditional factoring and asset-based lending services. In addition, the company serves as a discount factor for companies that do not qualify for typical asset-based lending or traditional factoring arrangements but have receivables from qualified account debtors and have demonstrated integrity in their business practices and products. First Capital's customers include manufacturers, distributors, importers and service companies with between $10 million and $100 million in sales.
"We are delighted with American Capital's investment," said John Kiefer, First Capital CEO. "The breadth of expertise of the professionals in American Capital's Financial Services Group coupled with the Company's ability to invest across the capital structure and engage in possible future strategic partnerships makes American Capital ideally suited to support our short and long term growth."
American Capital is a publicly traded buyout and mezzanine fund with $11.5 billion in capital resources under management. American Capital invests in and sponsors management and employee buyouts, invests in private equity buyouts, provides capital directly to early stage and mature private and small public companies and through its asset management business is a manager of debt and equity investments in private companies. American Capital provides senior debt, mezzanine debt and equity to fund growth, acquisitions, recapitalizations and securitizations.
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