A private equity backed candle manufacturer in the Southwest with distribution throughout the United States and Canada. They offer a variety of candle types, fragrances, and accessories.
The Financing Situation:
Due to growth the Company had a larger than usual seasonal need during its low working capital cycle in the summer. The Company’s bank could not increase availability fast enough for production going into the fall busy season. The Company’s business model is such that it does not generate accounts receivable so alternative lenders such as factors and asset based lenders were not an option for additional working capital and even if there were assets available to lend against, they would not be able to provide enough availability for production due to the heavy seasonality of the business.
Super G was able to get comfortable with the Company’s business model, management team, and heavy seasonality and structured a $2MM tailored solution that matched the Company’s cash flows. To facilitate a quick closing, Super G purchased the existing note from the senior lender and upsized the loan amount to provide additional working capital for production going into the fall busy season. This solution provided the Company with flexible capital quickly and positioned the Company to generate a strong fall/holiday season.