Republic Business Credit Provides $3.5 Million Asset-Based Loan for Oil Field Services Company
September 7, 2022
September 7, 2022
New Orleans, LA – When a Gulf Coast-based, private equity-owned oil field services company chose to refinance its bank line of credit, its leaders tapped the oil field expertise of Republic Business Credit.
The oil field company nearly sought Chapter 11 bankruptcy protection during the recent energy downturn; its private equity partner committed to the company’s future by providing a substantial equity and subordinated debt contribution as a bridge. But they still needed a senior partner who could be flexible.
“Republic was an easy decision, given the firm’s long-standing customer relationships, niche market, and sophisticated management team to continue our support,” the company’s managing director said. “While the private equity fund stepped up, the team needed a more agile debt partnership for the resurgence.
“Republic has funded several of our portfolio companies in the past few years. With an already agreed set of documents, we confidently and easily executed the closing process,” the managing director added.
The company and sponsor sought a growth-orientated ABL facility that would support future growth plans. Republic understood its business and provided industry expertise.
An oil field service and products manufacturer that supplies large energy production and refinement companies throughout the Permian and Eagle Ford basins, the company needed to refinance its existing bank line of credit to access its full availability while providing sufficient liquidity to scale the business back up during the energy recovery. The company specializes in equipment rental, completion services, pressure, and manufactured wellhead products.
The company president said: “We needed a senior debt partner who could react decisively and consistently and who viewed us as a trusted partner in our growth strategy.”
“Republic has demonstrated unique expertise in our industry time and time again while delivering on its promise of providing a unique facility for each of our structured credit and portfolio companies,” a founding partner of the private equity firm said.
Republic Business Credit provided a $3.5 million asset-based loan facility secured by accounts receivables, inventory and equipment that refinanced the company’s incumbent bank lender while providing significantly more borrowing base liquidity at closing. The company closed the senior debt facility with Republic during the third quarter of 2021 and has outperformed its budget every month since closing.
Republic was introduced to the opportunity directly from the private equity fund as a result of Republic’s reputation within the private equity community for lower and middle market, sponsor-owned ABL facilities.
“We continue our focus on providing ABL, direct to consumer loans and factoring to private equity portfolio companies across the country,” Republic President Robert Meyers said. “Our team worked with the company to structure a growth-oriented facility that provided significantly more liquidity to enable the management team to focus on growth.”
Republic CEO Stewart Chesters added: “Since our founding, we have always been committed to providing broad and inclusive access to working capital for lower and middle market companies that seek a better partnership than a traditional bank loan structure will provide.”
Republic Business Credit partners with banks, accountants, sponsors, lawyers, and investment banks to collaboratively support entrepreneurs across the United States, to create value, by enabling them to focus on growing successful businesses.