A well-positioned, well managed company utilizing merchandising platforms such as Amazon, Walmart, Jet, Groupon & eBay can be highly profitable. Their business model is to outsource virtually every business function except initiation of new and additional products. They are cash flow machines with virtually no assets. This works well for the entrepreneur until its time to sell.
Why NDFC? Typical sources of acquisition financing look for security with a lien on machinery, equipment, accounts receivable, and inventory. These companies have little or none of these assets. With purchase prices ranging from 2.7 to 5 times EBITDA millions of dollars needs to be raised to fund the purchase with traditional lenders absent from the field.
NDFC ties the purchase of these companies together with high asset value real estate in an innovative manner that satisfies traditional lending requirements. This innovative approach allows NDFC to close transactions that have eluded most other potential buyers.
Why NDFC? FX is a regulated industry and companies that trade client funds have to exceed minimum net capital requirements. When one company acquires another, the value of the acquired company will not show on the acquiring company’s balance sheet as a qualifying asset. Yet all the debt they incur as part of the acquisition shows as a liability. This can put the acquiring company below their minimum net capital requirements and out of business. NDFC provided the off balance sheet structuring solution to these regulatory restrictions that made it possible to use borrowed money and a seller’s note to fund the acquisition.
Why NDFC? Providing the capital and transaction structure so that the management team put up no cash, incurred no personal liability while getting 65% equity ownership. Even the due diligence costs of accountants and attorneys were done on barter for no upfront cost.
Each base company has two acquisitions in the pipeline which have agreed to the valuations, terms and conditions. The funding source has issued their $17.5 million term sheet on one and the other is pending. Both rollups own and lease helicopters and have contracts with government and the private sector to provide services ranging from firefighting, mail & freight delivery, logging, tourism, point-to-point transportation, moviemaking… even construction.
Why NDFC? NDFC has the breadth of experience to quickly understand the nuances of virtually any industry and quickly assemble the right players and structure for successful acquisitions including their integration into the operations of the acquiring company.
Arranged $30 million credit facility for first several mergers currently in the pipeline with hundreds of millions more dollars waiting on the sidelines.
Why NDFC? NDFC structured an ability for non-CPA investors to own and operate CPA firms even where state law denies such ownership and operations to non-CPA’s. This permits accounting firms to partner with providers of growth capital to bring needed expansion services to their clients.
NDFC is assisting in building worldwide distribution for client’s devices via licensing agreements.
Why NDFC? NDFC totally restructured client’s companies for asset-protection eliminating both his company’s and his personal exposure to product or medical liability claims and immunity from potential lawsuits. Part of restructure transferred significant value of company to his children with no gift, inheritance or estate tax. Structure also enables worldwide earnings with little or no income taxes.
The acquisition of the nursing home company complete, a second company 5 times as large is now in the pipeline with plans for a roll-up of other nursing homes underway across the UK.
Why NDFC? The acquisition of a nursing care facility generally requires the purchase of both the operating business and the real estate facility out of which it operates. Even if the seller is willing to take back a portion of the purchase price in a note, lenders require that the buyer prove funds for and actually pay an amount to the seller equal to at least 20% of the combined purchase price. NDFC provided the buyer with means to complete the purchase without having to put up any of the purchase price from their own funds.
Company also distributes beauty products associated with their niche specialty.
Why NDFC? NDFC provides current management with experience, guidance, contacts and vital resources which NDFC has used to build its own training and product distribution companies.
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