[Jstarr]

Were doing a real estate deal for a client that also needs to borrow against a purchase order.

The P.O. is for an order of 400,000 bushels of corn @ $5.05 per bushel from a national distributor and backed by an insurance policy for the value of the PO - Purchase Order Value is $2,020.000 they need $250,000 for 60 Days, that is when the po will be paid .

PFS and income stmt show considerable assets and reserves to service debt.

This isn't within our parameters so if some one could help that would be greatly appreciated.

pm me.

[RichardGerard]

Check into King Trade Finance

[Jstarr]

thanks Richard.

[bdshaw]

Guys, I never heard of them waiting for a year to get paid back.
Jay, what other real property collateral. do they have that may be used as collateral. Perhaps an ABL MIGHT WORK.
Bob

[RichardGerard]

Bob's right: PO Finance usually pairs with an ABL Facility.. Touch base if you need assistance... Between Bob and myself I'm certain you'll have the resources to get it done

[VFG]

This may be along the lines of PACA (Produce and Agriculture Commodities Act). If it is, there's only a handful of lenders who will finance this transaction as many factors try to stay away from this treaty as it requires a specific agreement. I would be interested in knowing:

1. Does the client have experience trading in this industry?
2. What are the gross margins of the transaction?
3. Is this a one-off transaction or is the client looking at consistent sales throughout the year?

Provided we understand their PO cycle and is within our criteria and the debtor is credit insured, we have no problem venturing in these type of transaction as we fund PACA deals/companies in the agricultural industry.

Feel free to DM me if you need any assistance structuring this PO finance deal. We will also need to factor the accounts receivable if we fund their PO just so you know.

Good luck!

[bdshaw]

Thank you VFG for pointing out more questions and letting us,know you do PACA deals.
I think the bottom line Jay is we are all looking for more details as well as the business in its entirety.
Bob

[Hedley Lamarr]

Were doing a real estate deal for a client that also needs to borrow against a purchase order.

The P.O. is for an order of 400,000 bushels of corn @ $5.05 per bushel from a national distributor and backed by an insurance policy for the value of the PO - Purchase Order Value is $2,020.000 they need $250,000 for 60 Days, that is when the po will be paid .

PFS and income stmt show considerable assets and reserves to service debt.

This isn't within our parameters so if some one could help that would be greatly appreciated.

pm me.

JStarr,

We have a ton of experience working with produce companies and understand PACA. We would need to understand a little more about the business overall not just the specific order in hand. If the Company has significant assets on their balance sheet to support financing the PO, you better approach would be to finance some of the current assets (AR and Inventory) as this will be much more cost effective than just financing the PO. If they have no current AR or Inventory to finance and PO financing is the only option, the PO finance company will want liquidity on the transaction through a factor or asset based lender. I would be happy to take a look to see if it is a fit for us.

Best,

Kevin

[TedFundy]

I will reach out.

[bdshaw]

JStar- if this has not been closed may I get a copy of the insurance policy please?
Bob