Porter Capital funded an $8.5 million credit facility for a Tier-1 automotive parts manufacturer.
Upon learning its current bank-owned factoring company had sold, the client, a foreign-owned U.S. subsidiary operating as a Tier-1 automotive parts manufacturer, was told to find a new factor. As a manufacturing business doing $50 million in revenue, the prospect was a match for Porter Capital’s funding capabilities.
Engaged by the client’s banking officer to refinance the relationship, Porter Capital extended an $8.5 million credit facility to provide enough availability to take out the existing lender and give the client room to grow and expand operations.
“Eighty-five percent of our client’s revenue comes from parts sold to Audi, BMW and Daimler,” John Cox Miller, senior vice president of Porter Capital, said. “We are not overly concerned when it comes to a client’s revenue being concentrated in three customers. However, we were challenged by our inability to obtain a personal or validity guaranty due to foreign ownership. Fortunately, our credit committee gained comfort with a corporate guarantee given its track record with customers.”
With its current production facility at roughly 200,000 square feet, the manufacturer is in the process of adding an additional 150,000 square feet to keep up with demand. The current semiconductor shortage has caused revenue to dip, but the company is forging full speed ahead.
“We are proud to support and add another client into our portfolio at Porter Capital. Manufacturing businesses in high-growth mode are a perfect fit for factoring,” Marc Porter, CEO of Porter Capital, said.
