Gibraltar Business Capital has a history of forming strong relationships with financial sponsors, focusing on creative ways to support their portfolio businesses in gaining financial security and optimal growth.
Gibraltar recently closed on a $10 million credit facility for a sponsor-backed specialty chemical business located in the Southwest.
Operating Challenges Create Transitional Revenue Volatility
The company performs contract blending, compounding and packaging of chemicals that require special handling, such as flammable, corrosive, combustible, highly sensitive and hazardous materials, as well as those requiring specialty container sizes. The chemicals are used in a variety of markets, including automotive, marine, aerospace, construction, electronic, geotechnical and military.
Although the business model, market and facilities were strong, operating challenges, including fluctuating raw material costs, were causing revenue volatility. The majority owner — a private equity group — looked to Gibraltar for a flexible source of working capital to support the company through a transition to greater stability. The company also needed funding to implement cost savings that would improve profitability over the long run.
Gibraltar Offers Flexible, Responsive ABL Financing
Gibraltar has extensive experience working with financial sponsors, who value the qualities Gibraltar brings to the table in formulating specialty asset-based financing:
- Understanding of the unique needs of a sponsor’s portfolio companies. No two companies are alike and financing transitional companies is not a one-size-fits-all process.
- Best-in-class service. Gibraltar prides itself on funding multiple deals for returning financial sponsor clients, a demonstration of their trust in Gibraltar’s ability to produce results.
- Speed to close. Swift action is crucial and Gibraltar’s decision makers understand that every day counts.
- Borrowing base creativity. Gibraltar is innovative and flexible in valuing a company’s assets.
- Open-minded, entrepreneurial approach to credit structuring. Gibraltar looks for the best structure for each client. Its team is trained to listen, think differently and take unique circumstances into account.
Gibraltar works with financial sponsors to overcome obstacles and put their businesses on the path of growth and prosperity.
Access to Senior Credit Decision Makers Was Key to Quick Results
In this case, the clients especially appreciated the access to senior management that enables Gibraltar to make and implement decisions quickly and forge strong relationships with its clients. Chief Credit Officer Mark Stoeberl took a personal role in finding the best solution for the chemical company.
“Part of my job,” says Stoeberl, “is to offer suggestions on how we can better structure transactions for our clients to maximize their potential for growth. Lending, for us, is not purely a numbers game. It’s about conversations and relationships.”
Gibraltar leveraged the value of three types of collateral — accounts receivable, inventory, and equipment — to provide the flexible support this business needs to meet its challenges and open new opportunities.
Gibraltar offers credit facility capacity between $2 million and $20 million to serve mid-market businesses and their unique needs. In 2018, Gibraltar broke a significant record, reaching $150 million in total commitments for the first time in the company’s history. Its customized financing solutions are helping Gibraltar clients overcome short-term capital challenges, navigate complex transitions, and take advantage of growth opportunities.