Specialty finance company GWG Holdings expanded into the merchant cash advance arena with the acquisition and formation of subsidiary GWG MCA Capital.

GWG MCA Capital Cash Advance acquired a $4.3 million portfolio of loans and advances from a subsidiary of Walker Preston Capital (WPC). As part of the transaction, GWG Merchant Cash Advance retained former WPC CEO Patrick F. Preece, who joined GWG MCA as its president and chief operating officer. Prior to WPC, Preece was head of asset securitization for Autobahn Funding, a $6.0 billion commercial paper conduit for DZ Bank that specialized in alternative asset classes.

Throughout his career, Preece has focused on the origination and management of structured finance and asset-backed lending with an emphasis on specialty finance.

“We are excited to welcome Patrick Preece to GWG’s senior executive team and have him lead this new operating division for us,” said GWG Holdings’ CEO Jon Sabes. “The merchant cash advance division provides GWG with another unique alternative asset class that we expect to contribute profitable earnings and shorter-term duration cash flows to the company.”

New York-based GWG Merchant Cash Advance provides capital to small businesses nationwide, filling a gap in the market for small business funding created by the increased capital and regulatory burdens of traditional lenders.