13 Mar Wabi International $16 Million Senior-Secured Credit Facility.
Here’s what we saw.
A Canadian infrastructure construction company that was transitioning its market focus to faster growing sectors of the global economy. Wabi quickly established a market reputation that eventually led to its merger with one of the largest energy contractors in the world. Others didn’t see it. We did.
Third Eye Capital structured a mixed revolving and term credit facility for Wabi that provided working capital during the company’s market transition. Their incumbent credit provider, a major Canadian Bank, had announced its intentions to reduce overall construction exposure in its commercial loan portfolio. Wabi was an unfortunate casualty of this decision, despite its strong growth and recent top business award from this same bank.
Wabi was in the midst of transitioning from an engineering construction firm with deep mechanical expertise primarily focused on the forestry sector to a highly skilled construction management company focused on the energy sector with cost plus and time-and-materials contracts. Wabi possessed a large, captive and flexible labour pool with advanced engineering talent, that we knew would be able to make the market sector transition from forestry to energy. We saw an experienced management team with a strong national reputation. We saw a company with vertical expertise that enabled a move away from an industry like forestry, experiencing a cyclical downturn, and a move towards the fastest growing sectors of the global economy. Others saw only risk; we saw opportunity.
Approach & Outcome
We help good companies like Wabi, that cannot access conventional credit due to perceived risk, size, complexity, or timing, reach their business goals. We assess transactions from the perspective of the business owner, and match our capital to not just business need but also asset value potential. How does the company make money, what is its sustainable competitive advantage, and how we best unlock value, are some of the key questions we try to answer with our portfolio companies.
We aligned ourselves with Wabi by providing a bespoke financing solution that drew upon our practical business experience in construction services. Wabi eventually unlocked value for all of its stakeholders through a buyout to one of the world’s largest energy infrastructure companies. We saw so Wabi could prosper.