SUCCESS STORIES
DividenD Recapitalization FOR SPONSOR BACKED Business Services Company
Rush Street Capital was hired by a Midwest-based family office for the recapitalization of its portfolio company, a Midwest-based business services company. Having experienced rapid growth in prior years, the Company was looking to recapitalize its balance sheet, replace its existing mezzanine lender, and provide liquidity to its shareholders. A week after Rush Street was engaged, the COVID-19 pandemic hit, which resulted in national shutdowns and unprecedented lender apprehensiveness towards new credits. The Company also sought to obtain growth capital to carry out its numerous growth objectives. Additionally, the Company was staunch in its position of not giving up any equity and was not open to a warrant structure in the new credit facility.
Despite the unprecedented lending conditions during COVID-19, Rush Street Capital was able to procure interest and multiple proposals from several mezzanine and unitranche lenders. Through our understanding of the Company’s needs and our large network of relationships, we successfully negotiated an all-cash interest plus PIK pricing structure for the Company that did not dilute ownership. The shareholders successfully took out six times the amount of capital that had originally been invested in the business.
Acquisition Capital Raise FOR Consumer Products Company
Rush Street Capital was hired by a Midwest-based private equity firm to raise financing for its acquisition of an East Coast-based consumer products. The Company, while sizable in revenue and profitability, had a significant customer concentration with a large brick-and-mortar retailer. Moreover, the COVID-19 pandemic hit during Rush Street Capital’s underwriting period, which resulted in significant apprehensiveness from capital providers
Despite the unprecedented lending conditions during COVID-19 and existing customer concentration, Rush Street Capital was able to procure interest and multiple proposals from capital providers. By carefully messaging the dynamics of the company’s relationship with its top customer, we were able to mitigate the risk and get the capital providers comfortable with that aspect of the Company. Through our understanding of the Company’s needs and our large network of relationships, we successfully closed the transaction.
Refinance FOR Sponsor backed Distribution Company
Rush Street Capital was hired by a Midwest-based family office for the recapitalization of its portfolio company, a Southwest-based steel distribution company. The existing mezzanine lender sought to exit the credit as the company had been part of the firm’s vintage fund. Having experienced up-and-down performance in prior years, the Company also faced significant commodity risk exposure, as the prices of steel had risen to unprecedented levels.
Despite the Company’s inconsistent performance and large commodity risk, Rush Street Capital was able to procure interest and multiple proposals from several lenders. Through our understanding of the Company’s needs and our large network of relationships, the family office successfully recapitalized the Company.
Acquisition Capital Raise FOR Aerospace and Defense Company
Rush Street Capital was engaged by an East Coast-based Private Equity Firm, to assist in their acquisition of a West Coast-based distributor and exporter, specializing in the sale of government certified aircraft replacement parts and chemicals, ranging from standard to hard-to-find components. The Company services an international customer base concentrated in Japan, Malaysia, Thailand, and the UAE. The Private Equity Firm was seeking a combination of debt and equity capital to consummate the transaction. The Private Equity firm sought a partner who understood the intricacies of a family-run aerospace business and the cross-border customer base that the Company served.
Rush Street Capital was able to quickly get up to speed on the transaction, prepare materials, and go out to its extensive network of capital providers. The Company being purchased, had a large cross-border customer base and stringent quality and safety standards that went conjointly with sending out its products overseas; Rush Street Capital was able to identify suitable capital providers amongst its network of relationships. Rush Street Capital was able to navigate the complexities of the transaction and make a competitive process out of the transaction, while procuring multiple investment and financing proposals
REFINANCE OF PORTFOLIO COMPANY BY MIDWEST PRIVATE EQUITY FIRM
A Chicago-based Private Equity firm hired Rush Street Capital to assist in procuring cross-border financing to refinance the working capital facilities for one of its portfolio companies. The existing lender was a large regional bank that had become uncooperative and unresponsive, despite the private equity firm continuing to support the company through fresh equity capital investments. The portfolio company was a more recent investment for the private equity firm with numerous growth avenues. Our customer reached out to lenders but these groups had difficulty understanding and underwriting the Company’s seasonal business and Canadian Operations. We were brought in to provide a thorough read of the market and identify firms that were capable of handling these factors. We were able to procure interest from a number of specialty asset-based lenders while still providing the Company with favorable terms. The Company’s main objective was to ensure adequate availability for both of its North American Operations. Through our understanding of the Company’s needs and our work in the negotiation and documentation process of the transaction, we helped ensure both of its American and Canadian operations had sufficient availability and room to grow in the years ahead.