Company Needs New Lender When Bank Exits Equipment Financing

Company Type:

-- Construction - Paving and Landscaping 

Location:

-- Northeast

Background:

Situation

Slow work season combined with an outstanding tax lien left them needing cash

Operating in a seasonal business is difficult, but when this company needed to refinance some equipment to bridge an income gap and pay off a tax lien, their bank informed the company they were exiting the equipment financing business and limiting their existing line of credit.

The bank’s decision was a change in corporate strategy, and the company needed a new lender to provide them with working capital to see them through their challenges.

They needed a lender that would:

• Understand their IRS situation and structure a loan to pay off the tax lien
• Offer flexibility and options to adjust to their changing needs
• Respond quickly and make rapid decisions
• Understand their seasonal business and equipment needs

Solution

Refinance and consolidation pays off existing tax lien, provides working capital to improve cash flow, and allows bank to exit.

CCG structured a loan that accomplished the following:

• Refinanced existing equipment, allowing bank to exit the equipment financing market without disrupting operations
• Allowed the company to maintain their real estate and line of credit relationship with the bank
• Paid off the total amount of the tax lien, allowing them to take advantage of growth opportunities
• Reduced the total number of equipment lenders and reduced their monthly debt service, simplifying debt service and improving their cash position
• Provided $1.2M in working capital to help ease cash flow pressure as their season began