#United States #Los Angeles #private credit #Pacific Coast Alternatives #NAV Lending

Pacific Coast Alternatives Closes $4.25 Million Secured Lending Facility

Pacific Coast Alternatives (PCA), a renowned private credit platform located in Southern California, has announced the successful completion of a $4.25 million secured lending facility. This financial move is specifically tailored to support independent private equity sponsors, offering them bespoke financing options that are secured by a diversified portfolio of private company interests spanning various industries.

Innovative Financial Solutions

The newly closed facility represents a form of net asset value (NAV) lending. This structure provides much-needed liquidity that is secured by the net asset value of the borrower's private holdings. What makes this facility particularly unique is its classification as a medium-term, secured credit facility, which is collateralized by ownership interests in a wide array of operating companies. These companies operate in multiple sectors including manufacturing, energy distribution, IT services, hospitality, and travel.

This financial structure is engineered to provide borrowers with flexible access to capital while enabling them to retain equity ownership and control over their businesses. Nader Hashemian, Managing Partner of PCA, emphasized the importance of this transaction, stating, “This transaction showcases the bespoke capital solutions PCA is built to provide.” He noted that many entrepreneurs find themselves in a situation where substantial wealth is tied up in illiquid private investments, which can limit their options for obtaining liquidity without divesting their businesses.

Market Demand for Tailored Solutions

The successful closing of this lending facility highlights a significant demand in the market. Many small borrowers in lower middle markets face challenges in obtaining traditional bank loans, especially given the constraints on non-traditional borrowers. PCA's strategy of providing creative, asset-backed facilities fills an essential gap in the market. This approach focuses on delivering capital solutions that cater to the specific needs of underserved segments.

Hashemian reaffirmed PCA's mission by stating, “We are committed to evaluating opportunities for tailored credit solutions for entrepreneurial borrowers.” This dedication aligns PCA’s interests with those of their clients, facilitating a cooperative relationship that benefits all stakeholders involved.

Key Details of the Transaction

Here are some critical highlights from the recent transaction:

• - Facility Size: $4.25 million, fully drawn at close.
• - Structure: Secured, medium-term credit facility stemming from a PCA-managed special purpose vehicle.
• - Collateral: The facility is underwritten by the borrower’s ownership interests in diverse operating companies, with additional personal guarantees from the principals involved.
• - Borrower Profile: An operationally focused private equity firm, known for acquiring, operating, and scaling lower middle-market businesses across the United States.

Legal counsel for PCA during this transaction was provided by Nelson Mullins Riley & Scarborough LLP, which played an essential role in navigating the complexities of this secured lending framework.

Conclusion

Pacific Coast Alternatives continues to emerge as a critical player in the private credit landscape, focusing on the needs of entrepreneurs and private equity sponsors. The firm’s innovative solutions are poised to support growth while acknowledging the unique financial challenges that these business leaders face. With a commitment to bridging the liquidity gap for those with substantial investments in illiquid assets, PCA stands ready to redefine accessibility in private credit solutions across numerous industries.

For more information about PCA and their financial services, please visit pcalts.com.