Working in the commercial finance industry with all the big names including GE Commercial, CIT and RBS, Robert Love always knew he wanted to strike out on his own. But it wasn’t until he picked up the phone and called Derrick Cephas, Amalgamated’s CEO, that he was able to get the new venture off the ground, in the form of Amalgamated Business Credit.
Having weathered the ravages of the last two years, some businesses are stronger than ever and are now experiencing unprecedented and growing EBITDA margins. At the same time, acquisition-hungry private equity investors are ready to do business with owners who are anxious for an exit. As a result, purchase prices of such businesses are escalating and will test the limits of secured financing as a new pricing paradigm emerges. Are lenders ready to stretch?
For this year’s fall conference issue, Howard Brod Brownstein chats with Bank of America Business Capital’s Bob Arth, the recently appointed president of Bank of America Business Capital. Brownstein asks Arth a question that may be on the minds of asset-based lenders: How do they do it?
Not so long ago, small- and mid-sized businesses had an all-you-can-eat buffet of capital. Investment, regional and community banks, asset-based lenders, hedge funds, factors and individuals all vied for the entrepreneur’s business — holding out carrots of competing rates and lighter terms. Banks competed with banks, and banks competed with alternative financing firms.
Without question, the news from Golub Capital has been steady even during the darkest days of the recession in which the loan market all but ground to a halt. ABF Journal spent some time with Lawrence Golub, the firm’s founder and president and the leader behind this remarkable success story…Reuters Loan Pricing ranked Golub Capital as the #1 traditional middle-market bookrunner in 2009. Buyouts Magazine named the company as the “Middle-Market Lender of the Year” for two years running. And in April of this year, M&A Advisor conferred it with the distinction of “Debt Financing Agent of the Year 2010.” The list of Golub Capital’s accomplishments seems to go on and on. Without a doubt, the provider of financial solutions with capital somewhere northward of $4 billion has been recognized for keeping a robust pipeline of deal flow while others in the space pulled back noticeably.
Has the factoring market rationalized? Factoring veteran Tom Siska warns us not to put away our protective gear … the Big Chill of 2008 probably won’t full thaw for quite some time.
For many years, letters of credit have been used to facilitate sales of goods and to provide credit enhancement for all kinds of contractual obligations. Despite the widespread use of letters of credit over the years, many view letters of credit as complicated and esoteric instruments. Part II of this series addresses security interests in letters of credit and the role of letters of credit in syndicated transactions. The third and final portion of this article focuses on the roles of letters of credit in commercial loans and bankruptcy. This part examines the treatment of letters of credit in bankruptcy.
Trying to understand the whole of H.R. 4173, the Dodd-Frank Wall Street Reform and Consumer Protection Act, is tough. The Act is long, complex and if you are focusing directly on the credit crisis, the Act is not particularly intuitive. Grant Stephenson at the Columbus office of Porter White Morris & Arthur discusses the Act’s impact on community banks.
In Part I of this article, Ken Naglewski of Seabiscuit Partners examines classical turnaround theory and practice in relation to the realities of organizational dynamics and the behavioral aspects of the players in a distressed debt situation. The author opines on the necessity of a CRO assessing the political realities of each situation and developing a political style and game plan that has the best chance to be successful in a particular situation. In Part II of this article, the author reinforces the importance of dealing with political realities of distressed debt situations, provides some examples from real situations and potential strategies for dealing with different situations.