The company is the leading provider of manned crane rentals and related services in the United States. They own and operate over 900 cranes in over 35 states.
The customer had a very restrictive covenant limiting capital expenditures. As a company that depends on new equipment to generate revenues from newly awarded business, this covenant limited growth opportunities. With each day representing opportunity lost, they required speed, financial structuring expertise and creativity to get the deal done.
First National was able to creatively deploy an operating lease structure to take the transaction off-balance sheet, enabling several equipment acquisitions without impacting the restrictive $10 million CAPEX covenant. By leveraging First National’s unique funding capabilities, the customer was able to establish a scalable relationship that offered almost unlimited access to capital for equipment needs with subsequent credit approvals coming within 48 hours for each request. Finally, the structure also gave them the ability to improve their cash flow, empowering more flexibility to adjust rental amounts for their customers–allowing them to provided the most competitive bids on the job. This resulted in a growing relationship with First National. The operating lease also provided additional flexibility to “right size” their fleet should demand for cranes fluctuate. Access to unlimited capital, a flexible approach to covenant management and added fleet flexibility led to the client winning more work, improving cash flow and increasing earnings.