Asset Based Lending (ABL)
What is Asset Based Lending?
Leveraging the assets on a business’ balance sheet is a core part of the financing solutions covered by FBX Capital. ABL is a broad brush term referring to ways and means of borrowing cash which is backed and collateralised by the business’ assets.
Example assets that can be used as collateral include accounts receivable, inventory, equipment, machinery and commercial property At FBX, we have successfully completed transactions from rudimentary invoice finance facilities through to structured transactions, as complex as cross-border syndicated borrowing base facilities.
Who is it suitable for?
There are many different forms of asset based lending, and facilities can be structured to solve various different problems. FBX have used ABL to solve issues ranging from basic long payment terms with customers, all the way through to freeing up cash on to complete on M&A (LBO, MBO, MBI) transactions.
What is the process?
ABL is all about the value of the balance sheet and the use of funds. Lenders will need to get comfortable with the value of the assets and what the business is going to do with the funds. If this is an invoice discounting facility, then clearly, valuing invoices is relatively simple but valuing a set of assets for a borrowing base facility, with different advance rates on each asset class, is going to take longer.
To get started, FBX require company details and financials and an understanding as to what funds are for. Our team have a long and successful track record in providing ABL solutions, so feel free to arrange a call back to discuss the various options available.
We are here to help. Contact us for a no obligation quote and advice.
