CapX Partners closed on a $5.5 million mezzanine debt loan to GRO-WELL Brands Inc. to support the company's growth needs.
Since 1855, the GRO-WELL name has been trusted by homeowners and gardeners for the finest in all-natural and organic lawn and garden products. As the largest green, wood and food waste recycler in the Southwestern U.S., GRO-WELL uses its proprietary composting process to make a full complement of organic products from waste by-product that would otherwise end up in landfills. The company processes and manufacturers residential and commercial organic material in excess of 200,000 tons annually by converting yard wood and food waste streams into branded and private label products. In recent years GRO-WELL invested significantly, expanding both its manufacturing capabilities and its product offering. The result has been an expansion of GRO-WELL’s footprint accompanied by increased working capital needs.
GRO-WELL sought a mezzanine debt capital provider that could help their senior bank lender replenish their revolving line of credit and support the company’s next revenue growth initiative. CapX designed a $5.5 million second lien mezzanine debt solution to address immediate capital needs of the company that was non-dilutive to ownership and acceptable to GRO-WELL’s senior lender. In addition, CapX looked to deliver future value by assisting GRO-WELL with its 2015 capital expenditure financing – a financing combination not often found in middle market lending.
“Laser like focus, quick understanding of the business model, no loss leaders and most importantly, delivered the desired result on time. The perfect combination! Would not hesitate to recommend to other decision makers and bankers” says Alan Langer, Chairman of the Board, GRO-WELL Brands, Inc.
“CapX appreciates the GRO-WELL platform created by their ownership and management. The Company’s competitive advantages in sourcing, trusted brands and strong retailer relationships convinced CapX to invest in GRO-WELL’s next growth phase. We look forward to being part of GRO-WELL’s continued success” says Jeffry S. Pfeffer, Managing Partner, CapX Partners.
Founded in 1999, CapX Partners is a specialty finance company that focuses on private equity and venture backed portfolio companies looking for debt financing in the $2 million to $20 million range. CapX provides senior and mezzanine debt including lease lines and favors manufacturing, distribution, technology, energy and healthcare industries with an emphasis on revenue producing fixed assets.