Debt Private Placements

The situation

Medical service provider had grown to four locations. Each facility was separately financed by separate banks thorough separate legal entities. Company had good expansion opportunities in contiguous markets. However, it had no ability to fund equity requirements for new facilities. None of its existing bank facilities would permit additional borrowing.

The company’s owners hired our professionals to raise capital.

How our professionals helped

Our professionals first performed a pro forma consolidation of the separate legal entities. This analysis confirmed the opportunity to refinance the existing separate entities in a single, cross-collateralized, non-recourse financing. The combined large cash flows, asset base and size would be attractive to the institutional private capital markets at lower interest rates. Our professionals determined that this funding strategy would generate sufficient proceeds to:

• replace the existing bank debt;
• provide the equity required for new facilities expansion, and;
• provide additional monies for buy-outs of certain partners.

Our professionals bypassed the banks and targeted the institutional private debt market with a well documented, albeit complex private placement.

The result

Our professionals successfully placed the private debt through leveraged lease financing with a large institutional insurance company. In the process our professionals uncovered equity value from within the company to fund profitable expansion.