America’s Car-Mart closed a new five-year, $300 million funded term loan facility provided by funds managed by Silver Point Capital.
In connection with this transaction, the company fully repaid the outstanding balance under its asset-backed line of credit (ABL), simplifying its balance sheet and creating a more flexible and scalable capital structure to support long-term growth opportunities and general corporate purposes.
The new term loan matures on Oct. 30, 2030, and bears interest at SOFR plus 7.50% per annum. The loan is secured and subject to customary financial and operational covenants. In connection with the loan, the company also issued Silver Point Capital warrants to purchase up to 10% of the company’s fully diluted outstanding shares of common stock at current market price. The warrant expires on Oct. 30, 2031, and includes customary registration rights for the underlying shares.
“We are excited to complete this transaction at a time of uncertainty in the market, which we believe demonstrates the fundamental strength of our business and our ability to execute on our long-term capital strategy,” Douglas Campbell, CEO of America’s Car-Mart, said. “By replacing our ABL facility with a new term loan, we have strengthened our financial profile and added new capital that will provide flexibility and agility for our originations and operations. This action aligns with our multi-year efforts to improve Car-Mart’s platform by reinforcing our core strengths, adapting to evolving market dynamics, and enhancing our balance sheet.”
Jonathan Collins, chief financial officer of America’s Car-Mart, said, “With a more flexible, longer-term component of capital in place, we are well positioned to further optimize our capital structure. This includes broadening our funding sources and continuing to enhance our ABS program, where we have seen continued improvements in our weighted average spread across recent transactions.”
Taylor Montague, managing director at Silver Point Capital, said, “We are pleased to partner with America’s Car-Mart to deliver a customized financing solution that strengthens the company’s capital structure and supports its long-term objectives. We truly appreciate the extensive engagement by the management team over the last several months that enabled us to complete the thorough due diligence that underpins our conviction in the durability of the enterprise and the company’s market position.”
Jefferies Finance served as financial advisor and Mayer Brown served as legal counsel to Car-Mart on this transaction.
