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Alliance Funding Group Secures $39MM in Upsized Corporate Notes

Alliance Funding Group has recently hit a significant milestone. The company has recently managed to upscale its corporate notes to an impressive $39 million. This development underscores AFG’s financial stability and unwavering commitment to fostering growth. It consolidates AFG’s intent to carve out a leadership position within the equipment finance landscape.

The new issuance was assigned a BBB rating by a nationally recognized statistical ratings organization, highlighting AFG’s steadfast financial reliability. AFG plans to allocate the proceeds from this significant transaction towards amplifying working capital and financing the company’s ongoing growth. Alliance Funding Group is actively pursuing potential acquisition opportunities, recognizing them as strategic pathways to further strengthen the industry position.

Since its establishment, AFG has been committed to providing small-ticket and middle-market equipment leasing, financial, and working capital solutions to businesses across the United States. Marking an impressive growth trajectory, Alliance Funding Group has injected over $2 billion into more than 25,000 businesses, with the ambition to expand the influence further, propelling the success of an even larger number of businesses.

AFG expresses appreciation to its core base of institutional investors, whose unwavering support and trust in our growing platform has been instrumental in the company’s success. “With our competitors tightening their credit boxes, we see an exceptional opportunity to gain more market share, both organically and through potential synergistic acquisitions,” said Brij Patel, the founder and President of AFG.

The company’s Senior Vice President of Capital Markets, Brent Hall, emphasized, “After our successful securitization earlier in the year, this recent financing move strengthens our balance sheet even more. We’re witnessing considerable demand from our customers, and this additional capital will empower us to cater to their financial needs in an increasingly volatile economic environment.”

Brean Capital, LLC played a pivotal role in this transaction, serving as AFG’s exclusive financial advisor and sole placement agent. Their expertise and counsel have been invaluable in this significant accomplishment.

AFG is committed to delivering reliable financial solutions to a wide range of businesses, irrespective of the credit type. Headquartered in Tustin, California, AFG expanded its presence with offices in Los Angeles and Carlsbad, CA, Portsmouth, NH, Austin, TX, and Tacoma, WA. Looking ahead, AFG is poised to leverage this additional capital, fortifying its suite of services and contributing to the financial health and growth of businesses across the United States.

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KBRA Assigns Preliminary Ratings to Alliance Funding Group’s First Equipment ABS

Kroll Bond Rating Agency assigned preliminary ratings to five classes of notes issued by Alliance Funding Group ABS I, (AFG 2023-1), an equipment ABS transaction. AFG 2023-1 represents the first equipment ABS transaction to be sponsored by Alliance Funding Group.

AFG 2023-1 is backed by a pool of equipment loans and leases (equipment contracts). The statistical discounted pool balance (statistical pool) totals $115.2 million and represents the projected cash flows of the equipment contracts discounted at a rate of 8.50%. As of the initial cutoff date, the discounted contract value will be at least $123.4 million and the initial pool characteristics are expected to be substantially similar to the statistical pool. The total collateral may increase by up to $31.3 million (27.20% of the statistical pool) through the addition of equipment contracts during the three-month prefunding period.

The statistical pool includes 1,421 contracts, with an average contract balance of $81,092. Obligor concentrations are low with 1,228 total obligors and the largest obligor representing less than 0.50%. The statistical pool is diversified geographically with the largest state, California, representing approximately 15% and all other states at less than 10% each. The pool is concentrated somewhat in the transportation industry, at approximately 19%. The pool benefits from a weighted average FICO of 747 and weighted average obligor time in business of 17 years.

AFG 2023-1 will issue five classes of notes, including a short-term tranche. Credit enhancement is comprised of overcollateralization, a cash reserve, subordination benefiting senior classes and excess spread. The overcollateralization is subject to a target equal to 15.00% of the current pool balance and a floor equal to 0.50% of the initial pool balance, accounting for any prefunding that occurs. The reserve account is funded at 1.00% of the initial pool balance and is non-amortizing.

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Dimer, a Leader in UVC innovation, Partners with Alliance Funding Group (AFG) to offer Flexible Leasing for its Revolutionary UVHammer Disinfection Solution

LOS ANGELES, March 10, 2021 — Dimer announced its partnership with Alliance Funding Group (AFG) to begin offering flexible and affordable leasing options for its state of the art mobile ultraviolet disinfection solution, coined the UVHammer. This partnership will continue to enable widespread adoption of higher health standards, making it possible for any organization to onboard this pivotal technology into their existing cleaning protocols.

Dimer’s UVHammer provides the fastest, simplest, and most effective UV disinfection on the market. The solution utilizes the same patented technology as Dimer’s GermFalcon – the revolutionary germ-killing device for aircraft cabins that has been brought to market globally by Honeywell, and more recently recognized in TIME’s Best Inventions of 2020.

Dimer’s UVHammer has been verified by a Nationally Recognized Testing Laboratory to be capable of disinfecting a 400sqft operating room in less than 3 minutes. The UVHammer’s patented design enables it to work in nearly any commercial setting and has been utilized to disinfect hospital rooms, hotel rooms, offices, electronics bays, restaurants, and more. The UVHammer is now available for lease starting at $35 / day.

“Dimer wants to save lives by killing germs. Our new partnership with AFG enables Dimer to offer incredibly affordable options for all of our customers, making sure everyone has the opportunity to access the best possible solution.” – Elliot M. Kreitenberg, Co-founder & President of Dimer

About AFG:

Alliance Funding Group (AFG) has funded over $2 Billion dollars in equipment loans, leases, and working capital to over 25,000 customers. Recently ranked as one of the fastest-growing independent leasing companies in the US, AFG possesses the financial resources, industry expertise, and product knowledge to serve the needs of small and medium-sized businesses throughout the United States.

 

Media Contact:

Max Solomon
VP of Marketing
max.solomon@dimeruv.com

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Alliance Funding Group’s Quest to Become the Next Big Independent

Alliance Funding Group has set its sights on a path of accelerated growth. Monitor catches up with CEO Brij Patel and SVP Brent Hall to discuss the company’s plans to become one of the top 10 independents in equipment finance.

The independent’s pursuit of capital is an ongoing story. But once an independent can attract the attention of the investor community, they are poised to ascend to the next level. With a recently announced closing of a $25 million ‘BBB’ rated corporate note financing, Alliance Funding Group (“AFG”) has set its sights on a path of accelerated growth.

Monitor caught up with CEO Brij Patel and Senior Vice President Brent Hall, who discussed the company’s plans to become one of the top 10 independents in equipment finance.

“Our overall acceptance in the market and the execution on our deal was fantastic,” Hall says.  “Our whole story, how long we’ve been around, the depth of the management team, where we are now and where we’re going is really exciting, and the institutional investor market recognized that immediately,” Hall says.

AFG initially went to market with a $20 million bond through Brean Capital, which served as the company’s exclusive advisor and placement agent in connection with the transaction. “Brean  came back to us literally within a couple of days of launch and said, ‘Can we increase that to $25 million?’  The deal was oversubscribed in under two weeks.

Capital to Grow

Since founding the AFG 23 years ago, the company has funded more than $2 billion to more than 16,000 commercial customers across multiple economic cycles while continuing to expand almost entirely through its direct sales efforts. The corporate note financing, coupled with a revolving credit facility that closed in November, will enable AFG to take its business to the next level.

Patel says AFG’s primary focus over the last three years really has been in the vendor channel. “Our story is a little bit different than other stories as we have the ability to do small ticket, mid-market and working capital, a three-product

approach to the space,” Patel says. “So we can add a lot more value to the dealer or manufacturer that sells into multiple grades of credit profiles in small ticket and middle market.”

The capital will give us the ability to increase our senior facilities,” Patel says. “It will be used as a haircut capital effectively, and for our structured finance product. Where a vendor wants a deal to be structured with some vendor support, we’re able to use the additional liquidity to provide a value-add solution to the vendor and the dealer and the manufacturer. So it really sets the stage for us to take the business that has historically done small ticket, mid-market and working capital to the next level with the vendor channel.”

“When you look at the independents that are currently in the space, it’s who’s up next, right?” Hall says, pointing out that Ascentium Capital, which was the perennial No. 1 in Monitor’s Top Private Independents’ ranking has been acquired along with other larger independents.

“A lot of the larger independents that were active in ABS have gone through their cycle,” Hall says. “The investment grade rating followed by the successful capital raise of the corporate bond — all of this just stacks up to our future growth. Our five-year plan positions us clearly to become one of the top 10 largest independents in the country.”

Material by Rita E. Garwood 2021, Monitor Daily.