ASSOCIATION NEWS
MERGERS & ACQUISITIONS
CFA: ABLS SEE INCREASED CREDIT LINE
USAGE BY U.S. BUSINESSES
THE COMMERCIAL FINANCE ASSOCIATION (CFA) released its Quarterly Asset Based Lending Index for the third
quarter of 2011. The index, based on data provided by the association’s 20 largest asset-based lenders, saw
credit line utilization surpass 40% for the first time in nearly three years.
The survey results indicate that U.S. businesses are continuing to increase usage of their credit lines, a
signal that business conditions are improving. In Q3/11, CFA members surveyed reported that asset-based
credit line utilization was 40.5%. This marks the third consecutive quarter that utilization has increased and
is the first time since Q1/09 that it has exceeded 40%. In addition, lenders’ new credit commitments were
26.7% greater in the third quarter compared to the same quarter in 2010.
There were other signs that activity in the ABL sector continues to increase in the third quarter. Seventy
percent of participating lenders reported positive growth in total credit commitments. Overall, total credit
commitments grew by 1.5% compared to the previous quarter and by 5% over the same quarter in 2010.
In another indication that the health of businesses are improving, The Quarterly Asset Based Lending
Index also revealed significant improvements in portfolio performance among reporting lenders in the third
quarter. Lenders’ non-accruing loans as a percentage of their total ABL portfolio fell by 34 basis points, with
70% of lenders polled reporting a decrease or the same level of non-accruals in Q3/11 compared to the
previous quarter. With respect to gross write-offs, 70% of lenders also reported a decrease or the same level
in the third quarter over the prior quarter.
The Quarterly Asset-Based Lending Index was conducted by R.S. Carmichael & Co., an independent market
research firm, to measure business growth, credit commitment, credit line utilization and portfolio performance
of the 20 largest CFA members engaged in asset-based lending. The survey was commissioned by the CFA. n
Capital Partners Fund I,
with the acquisition of
Handi Quilter, a provider
in quilting machines and
computerized quilting
systems. U.S. Bank
provided debt financing,
and Babson Capital
Management provided
subordinated debt.
equity co-investment
in support of the
acquisition of Emergency
Communications Network
(ECN), a provider of
critical, time-sensitive
communications, by
The Riverside Company
and members of ECN’s
management team.
TD Bank Acquires MBNA
Canada’s Credit Card Biz
TD Bank Group completed
the acquisition of all of
MBNA Canada’s credit
card portfolio, as well as
certain other assets and
liabilities, from Bank of
America. MBNA Canada
is the largest MasterCard
issuer and the fourth
largest credit card issuer
in the country.
Chase, Guggenheim Ink
Financing for TruckPro
Acquisition
Harvest Partners
completed the acquisition
of TruckPro, a distributor
of heavy-duty aftermarket
truck parts and
accessories, from funds
managed by Oaktree
Capital Management.
Chase Business Credit
and Guggenheim
Partners provided senior
debt financing for the
transaction.
business. The equity of
the CLO will continue to
be owned by Churchill
Financial Group. Ken
Kencel will lead the team
as managing director.
MERGERS & ACQUISITIONS
Carlyle Group Acquires
Churchill Financial From
Olympus Partners
The Carlyle Group acquired
Churchill Financial, a debt
capital provider to middle-
market companies, from
Olympus Partners. As part
of the transaction, 13
investment professionals
have joined Carlyle’s
Global Market Strategies
Fulcrum Completes MBO
of HSBC Capital Canada
Fulcrum Capital
Partners completed the
management buyout of
the mid-market mezzanine
lending and private equity
investment operations of
HSBC Capital (Canada).
Fulcrum Capital, led
by Dave Mullen, Neil
Johansen and John
Philp, along with an
investment management
team of 13, will manage
over C$750 million in
capital to provide private
equity, mezzanine and
bridge financing to
entrepreneurial businesses
in Canada.
H.I.G. Capital Acquires
Majority Interest in Pro-Pet
H.I.G. Capital acquired a
majority interest in
Pro-Pet, which specializes in
manufacturing premium
and super-premium,
private label dry pet food
for distribution worldwide.
High Road Capital
Acquires Quilting Machine
Manufacturer
High Road Capital Partners
completed the eighth
platform acquisition for
its debut fund, High Road
Maranon Capital Finances
ECN Acquisition by
Riverside
Maranon Capital provided
a senior revolving
credit facility and
term loan as well as
mezzanine debt and an
American Capital Supports
Renaissance Learning
Acquisition
American Capital invested
$10 million to support
RBC Capital Markets’
syndication of $75 million
in second lien term loan
financing to support the
acquisition of Renaissance
Learning, a provider of
technology-based school
improvement and student
assessment programs, by
Permira Advisors.
