For Business Owners

 

 

Caltius' Value-Added Solution


Since 1997, we have been working in tandem with our portfolio companies to fulfill their long-term growth and liquidity objectives. We have provided capital for such purposes as:

  • Liquidity events for owners, diversifying net worth and facilitating estate planning
  • Acquisition financing, including lines of credit for future transactions
  • Organic growth initiatives, such as geographic expansion or building new facilities
  • Recapitalizations to improve cash flow or reduce leverage


Perhaps more important than the capital we provide is the time we invest to help our portfolio companies achieve their business objectives. We often introduce add-on acquisition candidates, provide advice on the timing of asset/subsidiary divestitures and exit strategies, consult on financial structuring issues and generally provide a knowledgeable, yet objective, perspective to operating decisions.

 

 

 

The Subordinated Debt Solution


Subordinated debt can be an attractive alternative to private equity, or even senior debt, for business owners seeking growth capital or to diversify their net worth. By working in partnership with you, we help you to achieve your long-term goals - without sacrificing control of your company or its culture.

As demonstrated below, subordinated debt fits between senior debt and equity and has characteristics of each. Like senior debt, subordinated debt has a principal obligation in the form of an interest-bearing note that must be repaid by a specified maturity date. It typically has an equity feature structured as warrants, preferred stock or common stock to align the subordinated debt investor's long-term goals with those of the borrower.


By utilizing subordinated debt to recapitalize your business, you can take a dividend to diversify a portion of your personal wealth, yet retain control of the company and benefit from its future growth.

 

 

Dividend Recapitalization
With Subordinated Debt

 

Change of Control Sale
With Private Equity

Achieves partial liquidity

Achieves total liquidity

Maintains 80% - 95% ownership

Ownership reduced to 0% - 20%

Owner benefits from future growth

Equity partner benefits from future growth

Owner continues to control operations

Control ceded to equity partner

 

"First and foremost, we value Caltius as our business partner. They are great strategists and collaborate with management to establish and implement sound business ideas. We appreciate both their commitment and their capital to help us achieve our goals."


Rick Stein

Managing Director, UHY Advisors