Challenge:
- American Credit Counseling Services (A.C.C.S.), through partnerships with District Attorneys, offers classes to bad check writers as a way to reduce the criminal penalties they would be otherwise be assessed.
- The founders had decided to sell the company to a buyout group.
- A.C.C.S. is a service business with no appreciable assets. The buyers had no prior industry experience and no appreciable equity to contribute to this highly leveraged transaction.
Solution:
- Libra was able to structure a one stop debt facility supported by seller carry-back paper that enabled the management team to hold a majority interest in the company.
- This facility provided a much lower blended cost of capital than could have been obtained from traditional sources.