FGI Finance Provides SPS with a $15,000,000 Facility in Mexico
The SPS Group of Companies is a long-standing, full-line prime carbon steel distributor operating under various divisions, making it the largest privately-owned steel service center in the United States. With facilities throughout the country and Mexico, they offer a wide range of steel products, value-added processing, and steel-related services.
Over recent years, SPS has continued its growth and diversification through green-field expansions and acquisitions, most recently SPS de Mexico, increasing their need for reliable working capital. The Mexico operation had relied on a local Mexican bank to fund the operations using a letter of credit backed loan by a US bank. However, they soon realized that the Mexico lender could not offer a true working capital solution that would support the company’s growth and autonomy on a long-term basis.
SPS’s US bank, who previously worked with FGI, introduced the company to FGI as a trusted partner to provide a working capital solution in Mexico. Given FGI’s ten plus years of experience lending in Mexico, they were able to quickly execute a $15MM facility lending against SPS’s working capital assets. Not only did this provide much needed liquidity to their Mexico subsidiary, but it unlocked suppressed availability in the US company due to the previous complicated banking structure that tied in US collateral. With this additional capital, SPS can continue focusing on its future growth and acquisition targets.