SG Credit Partners provided a $2.75 million term loan to a provider of procurement and spend management software to mid-market businesses.
The company had legacy bank debt from a previous acquisition that was underwritten primarily by cash flow, not recurring revenue. The company’s growth plan called for re-investing all excess cash flow into growth, which conflicted with the profitability-based covenants of its existing credit facility. The company’s existing bank lender was unable to re-underwrite the loan based on recurring revenue and sought to exit the loan at maturity. SG Credit Partners structured the $2.75 million term loan to pay off the company’s existing lender and to provide additional liquidity to support the company’s continued growth plan.
