Supporting Lender Growth Through ABL Participation

Overview

Haversine Funding partnered with an established specialty finance platform to provide a participation in an asset-based lending facility supporting a rapidly scaling consumer products company.

Structure

• Up to $4MM participation in a $15MM ABL facility
• Collateral: Accounts Receivable + Inventory
• Structure: Participation alongside experienced lead lender

The Situation

The lead lender continues to experience strong portfolio growth and was seeking to both support a new lending opportunity and proactively manage portfolio concentrations. The underlying borrower is a high-growth company operating in a regulated industry, with increasing working capital needs driven by scale and seasonality. The facility included a meaningful inventory component alongside accounts receivable, adding additional structuring considerations.

The Challenge

This opportunity required balancing several dynamics:

• Lender-level considerations: managing growth while reducing single-name and asset concentration
• Collateral complexity: inventory tied to regulated products, requiring thoughtful control and liquidation assumptions
• Structure: aligning advance rates and borrowing base mechanics across A/R and inventory
• Credit profile: strong top-line growth with a path toward profitability

Additionally, inventory-heavy ABL structures can be more difficult to finance through traditional bank channels, particularly where flexibility and speed are required.

Haversine’s Approach

Haversine partnered with the lead lender as a participant in the facility, providing capital that supported both the transaction and the lender’s broader portfolio objectives. Haversine focused on:

• The lead lender’s credit discipline, reporting, and control infrastructure
• The structure and performance of the borrowing base, including both A/R and inventory
• The operating profile of the borrower, including growth trajectory and working capital dynamics
• Existing relationship history and execution track record with the lead lender

The Outcome

• Enabled the lead lender to continue scaling while improving portfolio diversification
• Reduced hold size on a single credit from $15MM to $11MM, with Haversine participating for $4MM
• Supported a structure that accommodates both receivables and inventory-driven availability

Key Takeaway

Participation structures can serve as an effective tool for lenders managing growth, concentration, and more complex collateral profiles. Haversine works alongside specialty finance platforms to provide flexible capital solutions that support both individual transactions and broader portfolio strategy.