Forte Capital / Troy Companies
Raising financing for the acquisition of Creative Craft Group
- In March 2024, Avaxa was engaged by Forte Capital (“Forte”) to assist their portfolio company, Troy Companies (“Troy”), in raising acquisition financing for the purchase of Creative Craft Group (“CCG”).
- Troy is a leading supplier of branded and licensed non-food consumer products. CCG is a market leader in the development and distribution of creative toys and craft products for children and adults. Like Troy, the company primarily sells its products to supermarkets and large discount retailers in the Benelux, Germany and the rest of Europe. Combined, Troy and CCG generated over EUR 183m in revenue in 2023.
- The acquisition of CCG aligns with Troy’s growth strategy and ambition to create a one-stop-shop for its growing international customer base. This acquisition, the sixth since Troy’s founding in 2021, further strengthens its market position in Europe and expands its innovative and complementary product portfolio.
- Avaxa ran a so-called ‘dual track’ financing process for Forte/Troy in which both traditional (bank) lenders, Asset-Based lenders as well as credit funds were approached. For potential financiers, Avaxa prepared an information package including bank presentation, financial base case model, Request for Proposal and Head of Terms. In addition, Avaxa supported Troy/Forte in preparing management meetings with lenders and with the negotiations between Forte/Troy and the lenders to reach the best possible financing solution in the market.
- Key in structuring the financing was to raise sufficient working capital financing due to the relatively high working capital requirements which are expected to further increase given the envisaged acquisition of Creative Craft Group and the anticipated growth of the newly combined Group under Forte’s co-ownership.
- The financing package consists of a Term Loan, an ABF, an RCF and an Letter of Credit facility. Both the ABF and RCF are used to fund the significant working capital requirements of the new Group and have been structured based on advancing inventory and receivables, thus maximally leveraging the underlying asset base of Troy and CCG.
- The transaction closed in August 2024 through a EUR 74m Club Deal involving three banks; ING, ABN AMRO and Rabobank, based on LMA documentation where Avaxa was an important facilitator to the banks, lawyers and Forte/Troy to reach an acceptable financing arrangement.
