BMO, a leading provider of asset-based finance solutions, closed as Sole Lender on a senior secured credit facility in support of MiddleGround Capital’s acquisition of HLC, Inc.  The ABL facility refinanced the Companies’ existing credit facilities, partially financed the acquisition, and will provide working capital financing to the company.  With operations in both Canada and the United States, BMO’s cross-border Asset Based Lending team provided a seamless “One Bank” financing solution to the company.

It is an unfortunate reality that, as the economic repercussions of the COVID-19 pandemic continue to be felt, an increasing number of businesses will face financial and operational distress. For many of these businesses, bankruptcy may be an appropriate or necessary path to restructure their balance sheets. However, it is not the only option and lenders must keep that in mind as companies increasingly default under their credit agreements.

Bankruptcy can be an extremely useful tool for restructuring a company, but can also be expensive, lengthy and frustrating. That’s why more lenders are considering a Strict Foreclosure process executed under Article 9 of the Uniform Commercial Code. This strategy can offer many of the same benefits as a bankruptcy filing while requiring less time and fewer financial resources. In order to properly assess the benefits and risks of this approach, lenders must have a firm grasp on what it entails, when best to use it, as well as how to manage people throughout the process.