USD$20.0m- ASX Listed Business
Service
Business & Corporate Finance
Client
Catapult Sports Ltd
Location
Global-Multinational
Industry
Sports Performance and Analytics
The Challenges
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The business committed to an accelerated investment in product development partly as the result the successful acquisition of a unique technology which, with bespoke tailoring for industry sectors, would have application to multiple existing clients.
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The investment would see the business turn earning and cashflow negative for up to 2 years.
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The challenge was amplified by the strong seasonal nature of revenues which materially impacted working capital
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The objective was to demonstrate to equity markets the business did not need further funding once increased working capital lines were established
Our Solution
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Working with the company we undertook a comprehensive analysis of the earnings profile under various scenarios to demonstrate the robustness of the annual recurring revenue, the impact of differing levels of revenue and margin growth, and the fact working capital could be fully repaid through the 2 years investment phase.
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We canvassed 14 lenders both as senior debt and as mezzanine debt to ensure we had both a preferred option and a back up option.
Clients Result
US$20m Senior Debt funding line was established with competitive pricing and the flexibility in covenants to deal both with the seasonal fluctuation in cash and the temporary negative earnings.