Capital Advisory Case Study


The Client was a premier provider of high-quality hydraulic fracturing sand in the midwestern United States. Initially launched with a single production facility, the Company grew quickly, developing a portfolio of assets that included two production facilities, 150 million tons of reserves, and 9 distribution terminals. Seeking to continue this impressive growth, the Company developed a pipeline of new projects and engaged Inlet Capital Group to explore financing options.

Engagement Approach

We examined the Company’s existing capital structure and determined that it was sub-optimal, burdened by debt amortization that absorbed the bulk of free cash flows, even though the Company had excess debt capacity. Recognizing that a more flexible capital structure with expansion features could free up operating cash flow and support the Company’s growth, we launched a financing process involving banks, alternative lenders, and other junior capital providers. We advised the Company throughout its discussions, helping evaluate its options, select an optimal path, and negotiate the most favorable terms.


The process yielded a wide array of financing alternatives from lenders and investors, with proposals that included senior secured debt, 2nd lien notes, mezzanine financing, and minority equity. We advised the shareholders to install a financing solution that included a 1st lien revolving credit facility and a 2nd lien term loan. With this $80M package in place, the Company was able to substantially reduce its debt service, increase its amortization flexibility, and fund all of its growth projects.

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