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Equipment Finance: Nations Equipment Finance

Business Overview

  • Acquired by SLRC in 2017, Nations Equipment Finance (“NEF,” or “Nations”) is an independent equipment finance company that provides secured financing solutions to companies in the United States and Canada

  • Founded in 2010 by a team of former GE Capital senior executives to fill a void in the marketplace created by the dislocation of traditional lenders post the 2008 – 2009 recession

  • Based in Norwalk, CT and currently has ~40 employees, with BDO offices in Bonita Springs, FL, Westlake, OH, Dallas, TX and Brea, CA

  • Diversified portfolio with over 90 portfolio companies

  • 100% collateralized investment portfolio

Borrower Profile Characteristics

  • Primarily privately-owned, medium-sized businesses in the US and Canada; good companies with high percentage of fixed assets that are in need of liquidity

  • Borrowers typically have limited access to bank financing

  • Equipment financed is mission critical to clients’ success

Typical Transaction Profile

  • Size ranges from $500,000 to $5,000,000

  • 3 – 7 year equipment leases or loans (4+ year average life); term of transaction shorter than equipment useful life

  • All equipment inspected and appraised at close with updates as required over time


Financial & Portfolio Snapshot

As of June 30, 2018
Investment Portfolio1: ~$350 million
Number of Issuers:  ~135
Average Position Size:   ~$2.5 million
% of Investments Senior Secured: 100%
% of Investments with Fixed Rate Coupon2:
~95%
Weighted Average Asset-level Yield: 10.5%
 

1. NEF Portfolio includes equipment financings held directly on SLRC’s balance sheet and in NEF Holdings LLC, a pass-thru portfolio company.
2. NEF’s fixed rate loans are short duration with average hold periods of 2.5 years.