Leveraged Finance

Our experience in specific niche sectors enables us to provide custom solutions to our clients in a timely and creative manner.

The CapitalSource Leveraged Finance group works with private equity firms throughout the United States to provide cash flow loans to middle-market businesses. Our highly focused vertical strategy, coupled with our transparent approach to assessing credit allows us to consistently deliver timely execution and creative structures for transactions aligned with our core expertise.

As a dedicated team of industry specialists, we typically focus on the following sectors:

  • Healthcare
  • Technology
  • Communications infrastructure

Although not a core focus area, we also pursue selective opportunities across an array of general industry sectors including: food and beverage, specialty distribution, manufacturing, restaurants, and business information services.

Financing Capabilities

We focus primarily on financings of leveraged buyouts and recapitalizations of companies with $7.5 million to $50 million in EBITDA. We leverage a broad range of financing capabilities to provide customized solutions for both small and larger borrowers, typically with the following parameters:

  • First lien senior secured and senior stretch cash flow or enterprise value loans
  • Debt facilities ranging from $15-$100 million
  • Typical hold sizes are $20–$25 million, with the ability to underwrite facilities up to $100 million

Industry Specializations

With three core areas of expertise in healthcare, technology, and communications infrastructure, we have built a reputation for delivering–regardless of transaction complexity–while still affording clients timely decisions to meet their goals and objectives.

Healthcare

In the healthcare market, we structure solutions for both owners and managers of healthcare companies. We serve a broad range of middle-market companies across many disciplines including:

  • Reimbursed healthcare services
  • Non-reimbursed healthcare services
  • Outsourced healthcare services
  • Revenue cycle management
  • Dental (DPMs & Labs)
  • Medical devices
  • Contract manufacturing
  • Branded/Generic/ OTC pharmaceuticals
  • Pharmaceuticals outsourcing
  • Managed care/Medicare Advantage plans and service providers
  • Third-party administrators

Our cash flow based senior debt solutions are often in conjunction with a private equity backed transaction. We have the flexibility for acquisitions, refinancings, recapitalizations, and general working for capital purposes.

Technology

In the technology space, we have experience lending to a broad range of companies across various industry sub-sectors. Our technology platform targets businesses that deliver mission-critical technological solutions with unique domain expertise, high levels of recurring revenue, and low capital intensity. Sectors of interest include, but are not limited to:

  • Application and infrastructure software
  • Integrated hardware
  • Technology-enabled business services
  • Transaction and payment processing

With our focus on senior financings we are able to support a broad range of transactions in the space, including:

  • Leveraged buyouts of mature technology providers
  • Debt accompanying minority or control "growth equity" investments
  • Re-capitalizations

Communications Infrastructure

Our communications infrastructure practice focuses on companies with owned or leased assets that provide similarly mission-critical solutions to carriers, enterprises, or small- to medium-sized businesses. Our sectors of interest include, but are not limited to:

  • Colocation, managed, and hosting service providers
  • Communications infrastructure and broadband providers (Metrofiber providers)
  • Communications and wireless infrastructure
  • E-commerce products and services

With our focus on senior financings we are able to support a broad range of transactions in the space including:

  • Leveraged buyouts of proven operators
  • Debt accompanying minority or control "growth equity" investments
  • Re-capitalizations
  •