- €60 million
Bank of America Business Capital provided a €60MM ABL Credit Facility to Chemtura Corporation. Proceeds from the deal will be used for working capital and other general corporate purposes for their operations outside of the US. The facility is supported by A/R and inventory outside of the US as well.
Chemtura Corporation is a diversified global developer, manufacturer and marketer of performance-driven engineered specialty chemicals. The Company's products are sold to industrial manufacturing customers for use as additives, ingredients or intermediates. The Company's agrochemical products are sold through dealers and distributors to growers and others. Its operations are located in North America, Latin America, Europe and Asia. In addition, it has important joint ventures primarily in the United States, but also in Asia and Europe.
- $100 million
Dayco Canada Corp $60,000,000 Dayco Europe BV$40,000,000
Bank of America Business Capital provided Dayco, LLC and its subsidiaries with $100 million in aggregate new global credit facilities.
Dayco is a global leader in the research, design, manufacturing and distribution of a broad range of belts, tensioners, dampers and pulleys for the Aftermarket, Automotive and Industrial end-markets
- $1.05 billion
Bank of America Business Capital provided a $1,050MM Asset-Based Revolving loan credit facility to MRC Global. Proceeds from the deal will be used to support general corporate purposes. Bank of America, N.A., acted as administrative agent, security trustee and collateral agent.
Headquartered in Houston, Texas, MRC Global, a Fortune 500 company, is the largest global distributor, based on sales of pipe, valves, and fittings (PVF) and related products and services to the energy industry and supplies these products and services across each of the upstream, midstream and downstream sectors.
MRC Global has operations in 20 countries and distributes products from over 400 locations.
- $900 million
Bank of America Business Capital provided a $900MM ABL Credit Facility to JBS USA LLC and JBS Australia Pty Ltd. Proceeds of the Facility will be used to support general corporate purposes.
Employing more than 85,000 people in North America and Australia, JBS USA is a leading animal protein producer and exporter with a leading position as a beef and lamb producer in the U.S. and Australia. JBS is also also a significant producer of pork in the U.S. An international industry leader, JBS USA is owned by JBS SA, a Brazilian multinational. Worldwide JBS SA is the largest animal protein processor in the world with 140 production facilities. The Company's global, diversified, low-cost production platform is the foundation for a variety of our products including food, leather, pet products and biodiesel.
- $1.35 billion
Bank of America Business Capital amended a $1.35 billion credit facility for Ryerson, Inc. The deal not only amended the credit facility but also reduced the interest rate and extended the maturity of the loan.
Ryerson Inc., a Platinum Equity company, is a leading North American processor and distributor of metals, with operations in the United States, Mexico, Canada, China and Brazil. The company distributes and processes various kinds of metals, including stainless and carbon steel and aluminum products
- $200 million
Bank of America Merrill Lynch served as Administrative Agent and Joint Lead Arranger on a new $1.1 billion, five-year revolving credit facility for AK Steel.
Headquartered in West Chester, Ohio (Greater Cincinnati), AK Steel is a world leader in the production of flat-rolled carbon, stainless and electrical steel products, primarily for automotive, infrastructure and manufacturing, construction and electrical power generation and distribution markets. The company operates seven steel plants and two tube manufacturing plants across four states: Indiana, Kentucky, Ohio and Pennsylvania.
- $125 millionRefinance/Working capital
U.S. metals service provider
Bank of America Business Capital provided an asset-based credit facility for Olympic Steel for $125 MM for working capital needs. Bank of America Merrill Lynch's relationship with Olympic Steel dates back to 2001, when they participated in a new senior credit facility.
Olympic Steel has bypassed gold, silver, and bronze in favor of carbon, coated, and stainless steel. A steel service center, Olympic Steel provides flat-rolled sheet, coil, and plate steel products. Its processing services include cutting-to-length, slitting, and shearing, along with blanking, laser welding, and precision machining. It also makes tubular and pipe products. Olympic Steel operates through subsidiaries including Olympic Steel Lafayette and Chicago Tube and Iron (CTI). It has processing and distribution facilities mainly in the eastern and Midwestern US.
- $670 millionWorking Capital
Provider of steel and steel related mining products
Bank of America Business Capital, acting as Administrative Agent, provided a new five-year, $670 million consolidated asset-based revolver to the North American operations of OAO Severstal. The newly syndicated facility was used to refinance their prior asset-based credit facility.
Headquartered in Cherepovets, Russia, OAO Severstal is one of the largest vertically-integrated steel and mining businesses in the world, with operations in Russia, Europe, Brazil and the U.S.
- £35.9 million
Metals & Waste Recycling
Bank of America Business Capital Provided a £35.9 Million Asset-Based Loan to Metal & Waste Recycling
Metal & Waste Recycling Ltd is a privately-owned company with 14 depots throughout the UK. The business has turnover of £300m and processes waste scrap metal to provide high-quality feedstock for a broad range of UK and international steel mills and foundries.
- $20 million
Permanent Floral and Home Décor supplier
Bank of America Business Capital completed a $20 Million senior secured revolving credit facility for Teters Floral Products, Inc.
Teters Floral Products is a leader in the permanent floral and home décor industries. Founded in 1957, the company has grown into a leading multi-national permanent botanical supplier – importing, assembling and distributing artificial floral products to wholesale and retail customers around the globe.
- £110 millionWorking Capital
Manufacturer of precision components, alloys and metals
Doncasters Group Ltd. is a leading international engineering group that manufactures precision components and assemblies for the aerospace, industrial gas turbines, specialist automotive, petrochemical, construction, industrial, transportation and recreation markets. The group excels in working with alloys and metals that are difficult to shape and form.
Doncasters operates from sites in the U.K., Continental Europe, U.S., China and Mexico. The client base is genuinely global and comprises most of the industry leaders in its relevant areas of activity. The group currently has about 5,000 employees worldwide Bank of America Business Capital closed a £110 million asset-based loan for Doncasters Group Ltd expanding its presence in the United Kingdom and Europe.
Bank of America Business Capital has expanded its presence in the UK and Europe by closing a £110 million asset-based loan for Doncasters Group Ltd. Bank of America Business Capital acted as sole arranger and joint bookrunner (left) on the asset based deal. In addition, Bank of America Merrill Lynch acted as joint bookrunner on an $876 million equivalent 7-year first lien term loan and $290 million 7.5-year second lien term loan. Contingent hedging solutions were also structured as part of this transaction.
- $50 millionRefinance
Supplier of stainless steel and specialty steel products
Atlas Steels is the largest supplier of stainless steel and specialty steel products in Australia and New Zealand. Atlas has 17 customer service sites, including a sheet and coil processing plant and a tubular mill where stainless steel and precision carbon tubular products are manufactured. In order to execute a turnaround plan, the company needed to secure flexible capital tailored to their specific goals and objectives.
Bank of America Business Capital has provided an asset-based credit facility for working capital needs. The facility also allows Atlas to issue letters of credit and other trade products. In addition, the bank is coordinating loan and cash management accounts and foreign exchange.
- #2 Bookrunner of syndicated loans to U.S. Large Middle MarketThomson Reuters, Q1, 2014
- #1 US Bookrunner of asset-based loans for the year 2013Thomson Reuters, 2013
- #1 U.S. Bookrunner of asset-based loans for the year 2012Thomson Reuters, 2012
Bank of America Business Capital provides asset-based credit facilities of $10 million or more throughout the United States, Canada and Europe for manufacturers, wholesalers, distributors and service businesses.
Planning an acquisition?
In a turnaround situation?
In need of increased working capital?
Outgrown your current lender?
Need the ultimate in flexible financing solutions?
If any of the above applies to your organization, then Bank of America Business Capital has a solution for you.
As one of the leading senior secured lending organizations in the world, with one of the largest asset-based portfolios, Bank of America Business Capital is positioned to finance companies in a broad array of industries.
An asset-based loan is typically structured as a revolving line of credit without a scheduled repayment and on an interest-only basis. The lender advances funds based on a percentage of the accounts receivable (normally 70-85 percent) and inventory (0-60 percent) and, when such assets convert to cash, the advances are repaid accordingly. Ineligible collateral is not included in the borrowing base. Ineligible accounts receivables include past due receivables, inter‑company receivables, and other lower quality receivables. Ineligible inventory includes work‑in‑process, packaging materials, or inventory at a sub-contractor.
A revolver allows a borrower to borrow, repay and reborrow as needed over the life of the loan facility. Bank of America Business Capital provides revolvers of $10 million or more.
One component of senior debt is a term loan. This is typically an asset-based loan that is based on a certain percentage of the orderly liquidation value of the machinery and equipment and the appraised fair market value of the land and buildings.
Asset-based loans against equipment and real estate are often made in the form of term loans that include regular periodic payments of both principal and interest in order to retire the debt at a fixed maturity date. Asset-based loans using real estate as collateral have longer maturities than equipment loans because of the generally shorter economic life expectancy of equipment.
Asset-based loans are secured by a wide variety of assets. Businesses can borrow money, using collateral such as accounts receivables and inventory or fixed assets such as plant, property and equipment. Asset-based loans also can include equipment loans and real estate mortgages.
Companies in an array of industries and at varying stages of their lifecycles use asset-based loans for a multitude of reasons including mergers and acquisitions, debt refinancing, capital expenditures, working capital, leverage buyouts and even employee stock ownership programs. Asset-based loans offer flexible financing solutions for the following uses:
Working Capital: The assets available to apply to a business' operations are considered working capital assets. At times, working capital loans are needed to bridge financial gaps during the lifecycle of a business. Working capital loans can be secured by a variety of asset types, including accounts receivable, inventory, equipment, and/or real estate.
Acquisition: To grow a business, a company may look to acquire a strategic partner or even a competitor. Asset-based financing is often an efficient means to obtain funding for business acquisitions.
Turnaround Financing: Turnaround financing is often used by under-performing businesses that are not achieving their full potential. In some cases, it is used for businesses that are either insolvent or on their way to becoming insolvent. Asset-based lenders are accustomed to the bankruptcy process and asset-based financing is ideal for turnarounds because of its flexibility.
Capital Expenditures: Capital expenditure is the money spent to acquire and/or upgrade physical assets such as buildings and machinery. Capital expenditure is also commonly referred to as capital spending or capital expense.
Debtor-in-Possession (DIP) Financing: Debtor-in-possession (DIP) refers to a company that has filed for protection under Chapter XI of the Federal Bankruptcy Code and has been permitted by the bankruptcy court to continue its operations to implement a formal reorganization. A DIP company can still obtain loans, but only with bankruptcy court approval. Asset-based lenders also provide exit financing or confirmation financing to companies coming out of bankruptcy.
Growth: Typically, as a company grows so does its need for financing. Also, as a company's collateral grows, its assets can strengthen its ability to borrow. An experienced and creative asset-based lender can assemble a credit facility that can scale to grow with a company.
Recapitalization: Recapitalization is the process of fundamentally revising a company's capital structure. A company typically might recapitalize due to bankruptcy or replacing debt securities with equity in order to reduce the company's ongoing interest obligation. A leveraged recapitalization typically achieves just the opposite—by taking on a material amount of debt, the company increases its ongoing interest obligation but is able to pay its shareholders a special dividend. Bank of America Business Capital has extensive experience guiding businesses through the stages of recapitalization.
Refinancing/Restructuring: When a company enters or exits a growth stage, refinancing or restructured financing may be key to creating a capital structure that better meets the needs of the company. This type of financing is often used for market expansion, completing an acquisition, restructuring operations, or following a successful corporate turnaround.
Buyout: A buyout is the purchase of a controlling percentage of a company's stock. In a leveraged buyout (LBO), the acquiring company uses the minimum amount of equity to purchase the target company. The target company's assets are used as collateral for debt, and its cash flow is used to retire debt accrued by the buyer to acquire the company. A management buyout (MBO) is an LBO led by the existing management of a company. Most LBOs are also MBOs.
Leveraged ESOP (Employee Stock Ownership Plan): A leveraged ESOP is one of many corporate finance alternatives that provide significant tax incentives to both business owners (potential deferral of capital gains) and ESOP Companies (potential exemption from federal income taxes). ESOPs can be used not only to finance stock purchases from existing shareholders, but also to facilitate corporate transactions such as management buyouts, acquisitions and divestitures.
There are a number of advantages to using asset-based financing:
Generates more liquidity — for a company within a cyclical industry, borrowing money against its assets may result in a more predictable borrowing availability. On the other hand, if a company borrows against a multiple of earnings (EBITDA) and the earnings decline, the borrower will find itself being able to borrow less.
Has built-in disciplines — because the borrowing availability is based on advance rates against current accounts receivable, an ABL structure motivates borrowers to collect their receivables more promptly. Similarly, because work-in-process generally is ineligible collateral, borrowers are motivated to increase the efficiency of their production process to increase liquidity.
Fewer financial covenants, including higher balance sheet leverage — typically, an asset-based loan requires fewer financial covenants because of its collateral orientation. The most common covenants are debt service coverage and net worth.
Lender patience — because a lender has collateral to protect its loan, the lender may be willing to give the borrower more time to turn around a company that may be having financial difficulties.
Client Web Site
abl.bankofamerica.com allows Bank of America Business Capital clients to access and monitor their account information quickly and easily over the Internet. With my.bofabusinesscapital.com, clients can log on for account information anytime, in a secure, private environment. Now clients can view online:
Loan status/availability — Check your availability on a daily basis
Loan ledgers — View loan transactions like wire transfers and deposits or look up transaction history
Month-end interest statements — Download statements right into your own spreadsheet software
Prime and LIBOR interest rates — Check rates easily
In addition, clients have the ability to submit online:
Borrowing certificates/borrowing base — Report collateral changes and borrowing base
Advance requests — Expedite your requests online
LIBOR requests — View your current rate's maturity date and amount or request LIBOR online
Clients can still rely on the expertise and personal attention of Bank of America Business Capital's Loan Servicing Administrators. abl.bankofamerica.com simply expands the service options to better meet client needs.
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A manufacturing renaissance is underway in the U.S., with more than half of U.S.-based manufacturing executives at companies with sales greater than $1 billion considering reshoring from China, according to a new survey by The Boston Consulting Group. Companies are also considering coming back from other formerly low-cost manufacturing countries as well for a number of reasons, including higher labor costs, freight costs, the need for easy collaboration between skilled workers, and tax benefits. This white paper explores the issues surrounding reshoring and the factors managers should consider when planning their own U.S. strategy.Download PDF (363.4 KB) More
A Guide to Asset- Based Lending
Businesses with increased liquidity and working capital needs may find an asset-based loan (ABL) to be an attractive alternative to conventional bank financing. A leader across multiple sectors, Milacron used asset-based financing to stage a turnaround, pursue a merger and position itself for future growth.Download PDF (564.8 KB) More
Atlas Steels Financing Opens Door to More Opportunities
Bank of America Business Capital closed a A$50-million asset-based loan to allow Atlas Steels to expand its presence in the Australia/New Zealand market. Atlas Steels is the largest stainless and specialty steel manufacturer and supplier in the region.Download PDF (225 KB) More
Auto Supply Industry Rebounds, But Who Will Fund The Growth?
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Companies in cyclical industries can gain access to a predictable source of capital with an asset-based loan (ABL). A leader across multiple sectors, Milacron used asset-based financing to stage a turnaround, pursue a merger and position itself for future growth.Download PDF (546.6 KB) More
Frequently Asked Questions about Asset-Based Lending
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"Bespoke ABL Financing" was a common theme at CFA's 7th Annual International Lending Conference at Bank of America Merrill Lynch in London in May 2013. This article quotes many of the conference leaders, panelists and organizers who discussed recent developments in cross-border lending and the outlook for European asset-based lending.Download PDF (1 MB) More
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Corporate and private-equity dealmakers increasingly recognize that international transactions will be a crucial part of any company's growth strategy. But the strategies and practices that are successful domestically don't always translate overseas — a lesson that middle-market companies need to learn quickly, or risk losses on their new ventures.Download PDF (3 MB) More
- Made in the U.S. - Manufacturing makes a return White Paper
- A Guide to Asset- Based Lending White Paper
- Atlas Steels Financing Opens Door to More Opportunities Case Study
- Auto Supply Industry Rebounds, But Who Will Fund The Growth? White Paper
- Frequently Asked Questions about Asset-Based Lending Article
- Bank of America Business Capital President Jeff McLane Talks With The Deal Article
- Asset-Based Lending in Europe Today Article
- International Transformation: Unlocking Value & Executing Abroad CapitalEyes