Rhyno Equity Group
Creating competitive tension among lenders
Rhyno is a private equity firm looking to acquire mid-market manufacturing companies in the GTA. The five partners are strong operators and entrepreneurs.
Rhyno made an offer on a company (its largest acquisition to date) with a tight closing schedule. The five partners approached FirePower to generate multiple proposals from lenders, both senior and junior, so that they could select the most suitable financing structure to support the purchase.
With Rhyno's focus on the acquisition - due diligence, managing the relationship with the seller, and preparing for post-closing, the partners wanted FirePower to manage the debt financing process. FirePower's investment banking team prepared a deal package and distributed it to 23 prospective lenders, then ran an auction that generated 8 proposals with significant variance in terms, cost and amortization. Through the auction process and subsequent negotiation, FirePower was able to identify the best lender for Rhyno. The key takeaway: while senior banks may look the same, they view risk differently, so it's essential to generate multiple proposals across banks to expose the differences, and then negotiate best pricing and terms.
GrowthGenius (“GG”) is an AI-assisted sales prospecting service provider for B2B businesses, headquartered at the OneEleven accelerator in Toronto. The company needed financing to fund its rapid expansion. Raising equity seemed like the obvious choice, but GG's exceptional growth prospects made an equity investment unappealing because of the high cost of dilution. GG sought out a debt solution, and were well into discussions with other lenders when FirePower was introduced.
Decisive Technologies is a value-added reseller of IT hardware, and BriteSky Technologies is a Canadian, managed cloud services provider (collectively “Decisive”). Decisive needed additional capital to accelerate its expansion plans. The shareholders were adamant that a new investor should share their values and vision for the company, and FirePower was engaged to find an investor and negotiate a deal structure that met all of the shareholders’ objectives.