Date Funded: 11/19/10
Facility Amount: $3,000,000
The Company: This company is a full service telecommunications plant design, engineering and deployment firm headquartered in Kentucky. They have served the telecommunications industry since 1994, adding a tower services division in 2010. They provide engineering, structured cabling construction, field mapping, fiber design and plant construction services for companies such as Verizon.
The Issue: This company was previously financed by a bank for several years. During this time, the company’s largest customer filed bankruptcy, leaving the company with a significant outstanding loan balance to the bank with limited repayment avenues. The bank and this company worked together over the last few years to get the account back in formula, reducing the balance over time through payment plans and subordinated debt/equity. Today, the outstanding loan balance is down substantially to just over $1 million.
The Solution: In order to provide this company the working capital it needs, a broker referred them to Joel Flig at Allied. Working together, Allied and the bank developed a payment plan that allows the bank to receive an initial pay down with monthly payments over the course of a year. Allied will be factoring a 100% customer concentration focusing on the two main components of this company’s business.
The Win: This “Funding by Allied” will allow the company to meet its working capital obligations while also providing an opportunity for additional growth.
November 19, 2010
Date Funded: 11/18/10
Facility Amount: $3,500,000
The Company: This company is a Texas based telecommunications construction and engineering firm. They provide equipment installation, engineering, structured cabling, staffing and networking services for companies such as Verizon (i.e. cable lines for FIOS).
The Issue: This company was a previous client of Allied who obtained a bank line of credit in mid-2009. Since that time, internal management changes materially affected the paperwork and billing practices within the business, ultimately causing a significant portion of their receivables to age over 90 days. These aging amounts adversely affected the company’s borrowing base with their bank due to cross aging, and consequently, the bank requested that the company seek alternative financing. In addition, the company has not received payments on these old invoices which has put an additional cash strain on the business.
The Solution: In the 2nd quarter of this year, the company brought in a turnaround management company, and they have been working diligently to clean up the aging receivables and/or work on a settlement agreement for those old amounts that remain unpaid. Allied was brought back into the transaction to provide funding on the current invoices with a partial pay down to the bank line of credit. The company was able to structure a long term pay out on the remaining balance owed to the bank over the course of a year.
The Win: This “Funding by Allied” will enable the company to meet their ongoing working capital needs, and it will also allow them to continue focusing their efforts on turning around the business.
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Tags: Recent Fundings, Small Business, Success Story, Working Capital
