Hercules Capital’s Acquisition of Asset-Based Lender – Gibraltar Business Capital


Dechert LLP represented Hercules Capital, Inc. on the deal

Hercules Capital, Inc. (NYSE:HTGC) has entered the commercial finance sector through its strategic acquisition of all of the outstanding equity of Gibraltar Business Capital, a leading provider of working capital to small and mid-market businesses through Gibraltar’s asset-based loan and factoring solutions.

Gibraltar will be held as a portfolio company of Hercules. Gibraltar will continue to operate as an independent senior secured asset-based lender to select small and mid-market businesses and operate under the Gibraltar Business Capital brand. Gibraltar and all its existing employees will remain at its headquarters in Northbrook (Chicago), Illinois. Gibraltar was formed in 2010 when Scott Winicour led the management buyout of Gibraltar Financial Corporation, a commercial finance company that dates back to 1951. The company subsequently changed its name to Gibraltar Business Capital, as it is known today. The company is comprised of seasoned professionals with decades of deep expertise in the asset-based lending and factoring industries. Since its formation in 2010, Gibraltar has underwritten more than $325.0 million in total credit facilities to more than 170 borrowers.

Hercules anticipates its investment in Gibraltar to generate a cash yield of approximately 10.0% to 14.0% and to be immediately accretive to investment income in 2018.

Hercules Capital, Inc. (NYSE: HTGC) (“Hercules”) is the leading and largest specialty finance company focused on providing senior secured venture growth loans to high-growth, innovative venture capital-backed companies in a broad variety of technology, life sciences and sustainable and renewable technology industries. Since inception (December 2003), Hercules has committed more than $7.3 billion to over 410 companies and is the lender of choice for entrepreneurs and venture capital firms seeking growth capital financing.

Dechert advised with a team including Jay R. Alicandri (Picture), Adam D. Rosenthal, Martin Nussbaum, Daniel S. Mozes, Sam I. Burum and Amanda E. Reed.

Involved fees earner: Adam Rosenthal – Dechert; Martin Nussbaum – Dechert; Daniel Mozes – Dechert; Sam Burum – Dechert; Jay Alicandri – Dechert; Amanda Reed – Dechert;

Law Firms: Dechert;

Clients: Hercules Capital, Inc.;

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Author: Ambrogio Visconti