Aerospace

  • Type: Acquisition Financing
  • Structure: Debt & Equity
  • Date: 2018
  • Location: San Marcos, TX
  • $31,000,000

Situation:

An aerospace and defense focused sponsor was seeking capital to effectuate the acquisition of a diversified aerospace company primarily focused on government charter operations, as a DOD CARB-approved air carrier, and on-demand air freight services. Congruent brought a great deal of value to the acquisition process through extensive experience with the Company under a prior investment.

Congruent worked with the sponsor and selected bank lender to implement a capital structure that was suitable for the Company and that provided appropriate interest alignment going-forward. Congruent ultimately structured a $31,000,000 mezzanine loan and equity co-investment. The combined capital structure maximized flexibility to quickly fund growth initiatives through upsizing of the senior bank facility, while minimizing debt service requirements immediately post-transaction.

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Business Services

  • Type: Acquisition Financing
  • Structure: Debt & Equity
  • Date: 2018
  • Location: Flower Mound, TX
  • $32,500,000

Situation:

The Company is niche pharmacy benefit manager, specializing in servicing private clients with unique servicing requirements. The Company’s long-standing customer relationships and multi-year contracts provide significant protection from economic cycles. The Company is backed by a growth minded Sponsor with a history of successful exits.

Congruent partnered with another firm investing $32,500,000 through a first lien term loan and an equity position. This investment facilitated a sponsor backed buyout of the Company alongside management.

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Energy Services

  • Type: Acquisition Financing
  • Structure: Debt & Equity
  • Date: 2018
  • Location: Houston, TX
  • $11,000,000

Situation:

Congruent facilitated a merger of two wholesale equipment businesses in the oil and gas industry. Both businesses specialize in certain new equipment used in oil and gas drilling. The business combination creates a stronger player in the space with broader customer relationships, more locations, deeper inventory, and cross-sell opportunities.

Congruent partnered with another local investment firm to provide an $11,000,000 investment at an attractive valuation without further diluting the Sponsor’s equity. Congruent’s investment is supported by strong asset coverage.

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Energy & Natural Resources

  • Type: Acquisition Financing
  • Structure: Debt & Equity
  • Date: 2017
  • Location: Dallas, TX
  • $17,000,000

Situation:

The Company refines shut-in natural gas reserves to levels acceptable for sale in the traditional midstream market while recovering marketable helium. The Company owns a number of midstream assets in various basins throughout the country. The Company’s technology and operations allow for the extraction of latent value in these reservoirs.

Congruent structured a $17,000,000 investment comprising a first lien term loan and an equity investment for the purchase of a new midstream asset with previously undeveloped energy resources. This investment allowed the Company to begin gas production and helium recovery in this system.

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Technology & Software

  • Type: Minority Recapitalization & Growth Capital
  • Structure: Debt & Equity
  • Date: 2013 & 2015
  • Location: Dallas, Texas
  • $14,650,000

Situation:

An owner-operated, software-as-a-service provider to automotive dealerships was seeking to refinance an existing senior secured term loan.  The Company, with its long operating history and strong management team, is a leader within its niche, with an approximate market share of over 30%.  The Company sought a lending partner that had the interest and ability to grow with the Company over the coming years.

Congruent initially funded a $5,000,000 senior secured term loan for the refinancing.  After building a strong relationship over the next 18 months, the management team approached Congruent about an exciting new growth opportunity it was considering. After thorough diligence, Congruent upsized its existing term loan and made a preferred equity investment to fund the growth.

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Cable & Telecom

  • Type: Refinancing & Growth Capital
  • Structure: Debt
  • Date: 2013 & 2015
  • Location: Atlanta, Georgia
  • $41,000,000

Situation:

A leading provider of broadband communication services (video, internet, and phone) to a growing suburb of Atlanta, Georgia was looking to refinance its existing indebtedness and raise additional capital to fund the conversion of its network from analog to digital. Creating a digital network was a key growth opportunity for the Company, as it allowed for an increased number of high-definition cable channels and higher speed data products.

Congruent co-invested alongside a long-time partner in a $36,000,000 first lien term loan. Congruent was comfortable with the investment due to the recurring revenue dynamics, growing population in the Company’s local market area, and the sponsor’s equity thesis.

Given the stable financial performance since close and the attractive growth prospects, the lender group upsized the first lien term loan by $5,000,000 in January 2015, to repay a portion of the outstanding subordinated debt and fund an expansion of the Company’s network.

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Distribution

  • Type: Growth Capital
  • Structure: Debt & Equity
  • Date: 2014
  • Location: Dallas, Texas
  • $40,000,000

Situation:

A family-owned, multi-generational, heavy equipment distributor was seeking to expand its reach by acquiring a large distributor in a neighboring territory, thereby creating a combined Company with broad reach and best in class products. The family, having built significant balance sheet equity over the years through retained earnings, elected to raise junior debt capital instead of contributing $40,000,000 of additional equity.

Congruent proposed a second lien term loan structure that would sit behind the senior lender’s asset-based revolver in the capital structure. While the Company is paying traditional mezzanine economics, the family avoided the dilution that would have come with an equity raise. Congruent is protected through its senior secured position and covenant protection in the credit agreement.

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Contractor Services

  • Type: Acquisition Financing
  • Structure: Debt & Equity
  • Date: 2017
  • Location: Austin, Texas
  • $5,250,000

Situation:

An Austin-based family office partnered with the management team in the acquisition of a specialty electrical contractor that was founder owned since the 1980s. The family office had commitments from senior lenders and was bringing meaningful equity. They approached Congruent about providing a $5,250,000 second lien term loan and minority equity investment.

Congruent worked with the family office and management team to implement a capital structure suitable for the industry. Congruent continues to serve as a value add business partner through direct involvement at the board level, helping to provide oversight and guidance as the Company executes its growth strategy.

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Healthcare

  • Type: Growth Capital
  • Structure: Debt & Equity
  • Date: 2017
  • Location: San Antonio, Texas
  • $25,000,000

Situation:

The Company is innovative in the healthcare space, developing, manufacturing, and marketing cardiovascular products. It is backed by a high quality, committed family office with a very significant capital investment and a track record of building businesses in the industry. The Company recently achieved a critical milestone and sought outside capital to aid in further commercializing its proprietary technology.

Congruent structured a $25,000,000 investment comprising a first lien term loan and delayed draw facility. The Company was able to avoid higher dilution from an equity raise while gaining access to additional growth capital. Congruent is protected through a senior secured position on an attractive asset base.

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Niche Manufacturing

  • Type: Buyout
  • Structure: Control Equity
  • Date: 2018
  • Location: Cibolo, TX
  • $13,500,000

Situation:

An international heavy equipment manufacturer was seeking to divest an orphaned subsidiary that focused solely on US Department of Defense work. The management team of this subsidiary saw value in the remaining maintenance contracts and opportunities with commercial customers and was seeking a capital partner to enable them to acquire these operations. Congruent partnered with another firm to acquire the Company alongside management investing $13,500,000 of debt and equity.

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Business Process Outsourcing

  • Type: Minority Recapitalization & Growth Capital
  • Structure: Debt & Equity
  • Date: 2017
  • Location: Houston, Texas
  • $7,750,000

Situation:

Founded in 2005, the Company provides project management services to large industrial facilities in support of maintenance operations at downstream oil & gas, chemicals, and fertilizer plants. The Company’s customers consist primarily of large Fortune 500 companies.

The CEO, who owned 100% of the Company's equity, was seeking to sell a minority stake in order to diversify his personal wealth and bring in a partner to pursue near-term growth opportunities. Congruent invested $7,750,000, comprising a second lien term loan and a preferred equity investment, alongside one of its strong senior lending partners. This structure satisfied the owner’s personal financial goals and provided the Company with the needed growth capital, while still allowing the owner to retain control of his business.

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Media & Entertainment

  • Type: Growth Capital
  • Structure: Debt
  • Date: 2012 & 2014
  • Location: San Antonio, Texas
  • $14,800,000

Situation:

A family-owned operator and developer of live entertainment venues was raising growth capital to fund the Company’s capital contribution for two new venues. These venues were being developed in partnerships with local municipalities which were providing a majority of the development capital.  Upon completion, the Company would manage and operate these venues under long-term leases. Management are considered best-in-class operators with sterling reputations in this niche industry.

Congruent initially structured a $9,800,000 first lien term loan with warrants, providing a highly unique and customized structure that allowed for the delay in cash flows from the ramp of the new theatres.

Approximately two years after the initial raise, the Company approached Congruent to upsize the existing facility by $5,000,000 to provide financing for a third venue, under similar terms as the initial funding.  Congruent saw this as an opportunity to expand its relationship with a great Company and management team, expeditiously working to a quick close.

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