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Asset Based Lines Of Credit For Canadian Business
Information on ABL financing in Canada . How does this type of asset finance differ from bank facilities and why asset based lending increases borrowing power for working capital purposes
ABL is a revolving line of credit facility whereby your assets are secured by the facility you borrow against all those assets on a daily basis.
But, and its a big but, as opposed to bank financing via a Canadian chartered bank facility you are allowed to borrow against the real world maximum liquidity of those assets . Typical assets secured under an ABL financing facility are receivables, inventory, fixed assets, and on occasion real estate if that also fits into your asset equation.
The uniqueness of Asset based lending is simply that the majority of these facilities are offered by what we call ' non - banks - given that that majority of Canadian business owners and financial managers associated ' borrowing' and lines of credit with Canadian chartered banks. Instead , the ABL community tend to be independent finance firms, some of whom are U.S. based but doing business here , who focus and have tremendous expertise in the one thing you cherish most - your business assets !
So where does the versatility com from then? That’s the great part of a line of credit via asset finance strategy. It's all about what we call ' maximization ' (is that really a word?). In ABL financing usually 90% of receivables become an immediate borrowing base, and inventory tends to be financed in the 30 -70% range. In case you haven’t figured it out yet (we’re sure you have) that’s about 30-70% more than you probably were getting before. And, under the concept of true asset finance, the appraised value of your unencumbered fixed assets also now become part of your daily borrowing ability for cash flow and working capital as you need it . Tell us that isn’t versatility!
Because ABL financing increases your ability to borrow for liquidity purposes it allows you to put aside the challenges of meeting qualifications for chartered bank lines of credit - all those things your banker loved to talk about - leverage, cash flow coverage, minimum debt to equity ratios and on it goes... you know the drill.
So, is your firm eligible? It is if you meet the sole criteria - you have assets! The beauty of asset finance is that it works for small firms, major corporations, firms that have financial challenges, and those enjoying the best of all worlds, high growth and profits and a need for constant new working capital.
So, got what it takes? If you have the need, for increased, flexible and higher lines of borrowing power then speak to a trusted, credible and experienced Canadian business financing advisor who will ensure you have a facility that meets your firms unique survival, growth, and financing needs.
7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.
Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.
Stan Prokop
