Loeb Helps Private Equity Firm Convert Equity into Debt with $3.5MM Asset-Based Lending Solution

Quick Take
Businesses seeking liquidity or refinancing can benefit from asset-based lending strategies that leverage machinery and equipment as financial tools. Loeb recently helped a private equity firm convert equity into debt, securing $3.5MM in funding without disrupting operations. Key takeaways: act before asset values decline, use M&E assets strategically, and structure collateral effectively.

Chicago, IL — In today’s fast-moving industrial markets, timing and strategy can make or break a deal. Loeb recently partnered with a private equity firm invested in a leading CNC machining and large-part assembly company to tackle a critical challenge: converting equity into debt without disrupting operations.

The Challenge
The client sought to make their investment liquid, but declining machinery and equipment (M&E) values posed a significant risk. In capital-intensive industries, waiting too long can erode asset values and reduce borrowing power.

The Solution
Loeb delivered a tailored asset-based lending solution, leveraging the company’s substantial M&E assets to structure a financing package that efficiently replaced equity with debt. The result: $3.5MM in funding and a seamless refinancing process.

Loeb’s unique position as lender, appraiser, and auctioneer provided a competitive advantage, ensuring accurate valuations and strategic timing throughout the transaction.

Key Lessons for the Industry

• Timing is Everything: Delaying conversion can lead to lower valuations. Regular appraisals and market insights are essential.
• Leverage Your Assets: Machinery and equipment aren’t just operational, they’re financial tools. Asset-based lending, leasebacks, and refinancing can unlock capital for growth or restructuring.
• Structure Collateral Wisely: When multiple lenders are involved, carving out M&E outside a bank’s borrowing base can maximize liquidity without disrupting existing credit lines.

About Loeb

Since 1880, Loeb has been helping manufacturers and financial institutions leverage their industrial assets by managing the equipment lifecycle. Loeb monetizes industrial assets through financing, valuations, auctions, acquisitions, and sales.

For more information, visit https://www.loebequipment.com