Situation

A wealth advisor at a large universal bank referred a leading consumer packaged goods brand with over $100 million in annual sales. The company was experiencing rapid growth and needed additional capital to sustain its momentum. It had an existing senior debt facility in place and was seeking junior mezzanine debt to fund further expansion. The owner was planning to sell the company within one to two years and wanted to avoid any dilution of ownership to maximize the eventual sale value.

Approach

We identified an east-coast private credit fund to provide $7.5 million of non-dilutive junior capital. The existing senior lender, however, was reluctant to add another creditor to the capital structure. Rather than force a multi-lender arrangement, we worked with the new capital provider to structure a larger uni-tranche facility that took out the senior lender entirely and consolidated the company's debt into a single tranche. The result was a cleaner capital structure, growth capital in place, and no dilution.

Outcome

$25 million uni-tranche facility. The company received the growth capital it needed while simplifying its debt structure from two creditors to one. Ownership remained fully intact ahead of a planned sale.