Service Type: Refinancing
Client: La Lomita, Inc. and Affiliated Companies
Client Description: An ExxonMobil fuels wholesaler and retailer operating 23 c-stores and 5 Travel Centers.
- The Company’s existing lender was “out of market” in its loan terms, over-collateralized for its loan size, and unable to accommodate expanded debt facilities for the Company’s organic growth plans already in process.
- Corner Capital found that the Company’s existing long term debt, with several lenders, was over-collateralized due to its lender’s aversion to the retail c-store asset class. Furthermore, the existing debt was originated in the late 2008 lending environment, when the Company was unable to pursue alternative financing due to lack of availability.
- Corner Capital sought to collateralize the new loan with fewer Stores, freeing up the remaining retail assets to use as “dry powder” in its acquisitive and organic growth efforts.
- Corner Capital suggested several facilities to take to market - comprised of senior term, store development lines of credit, and accordion-style revolver for future growth.
- Corner Capital Advisors structured a refinancing and capital-raising transaction on behalf of the Company, refinancing nearly 96% of its existing debt with a more suitable lender, collateralized by a reduced number of c-store assets.
- Despite the reduction in collateral, the new loan structure still provided a strong coverage ratio of 2.40x FCCR on the refinanced portion of the Company’s debt service, while maintaining a projected LTV of approximately 78% -- attractive lending terms that were both marketable and accretive to the Company and a new strategic lending relationship.
- Corner Capital’s proposed refinancing package considered the Company’s long term needs for future growth and included a new credit facility, construction financing, and a forward facility, through the same lender providing the term debt financing.
- Corner Capital successfully marketed the proposed refinancing package through its network of lenders familiar with the Downstream Energy industry.
- The Company was able to consolidate its financing sources into a single lender that understands the Company’s business, has high concentration thresholds, and will grow with the Company.