Precision Manufacturer Secures SBA 7(a) Refinance and Growth Capital for Expansion
Introduction
In today’s advanced manufacturing sector, capital strategy plays a defining role in a company’s ability to scale, modernize, and compete. A U.S.-based precision manufacturer—producing highly specialized components for the aerospace, medical, and automotive sectors—approached Cornovus Capital to solve a growing challenge: multiple high-cost debts were constraining the company’s ability to invest in its future.
While the business had a strong order pipeline, rising input costs, fragmented loan obligations, and zero access to discretionary capital created growing pressure. The company needed more than a basic refinance—it required a fully integrated capital solution. Cornovus Capital delivered just that through a structured SBA 7(a) loan that consolidated all outstanding debt, introduced working capital, and created long-term financial stability.
Challenge
Disjointed Debt and Insufficient Liquidity Limited Growth: The company had accumulated five separate term loans over the years to fund equipment, property improvements, and general working capital needs. While each loan met an immediate objective, the cumulative effect was problematic:
- Cash flow was compressed due to multiple monthly payments
- Loan terms varied, creating inconsistent amortization schedules and difficulty forecasting
- The company had no surplus liquidity to fund new contracts, improve production efficiency, or upgrade its equipment
With no excess equity available to contribute, the business needed a 100% debt-financed solution—a structure that preserved ownership while enabling growth.
Solution
SBA 7(a) Refinance with Built-In Growth Capital: Cornovus Capital structured a single SBA 7(a) loan totaling $928,000 to refinance $876,000 in existing debt and provide $30,000 in unrestricted working capital. The remaining $22,000 covered standard closing costs, allowing the client to preserve its own liquidity.
The SBA 7(a) product was strategically selected for its long-term amortization, lower monthly debt burden, and flexible use of proceeds.
Key loan features
- Loan amount: $928,000
- Loan type: SBA 7(a) term loan
- Interest rate: Prime + 2.75%, adjusting quarterly
- Amortization term: 25 years (fully amortizing)
- Monthly payment (est.): $5,979.12
- Equity injection: Not required under SBA program terms
Use of funds
- Debt consolidation: $876,000 across five loans
- Working capital injection: $30,000
- Closing and third-party fees: $22,000
Collateral and structure
- First mortgage positions on industrial real estate
- Blanket lien on business assets, machinery, inventory, and receivables
- Personal guarantees from principal owners
- SBA guarantee fee waived under federal COVID-19 relief
Execution
Streamlined Underwriting and Lender Alignment: This transaction required highly coordinated execution to meet timing constraints and compliance standards. Cornovus Capital managed every aspect of the process, including:
- Preparing SBA-required documentation and business financials
- Coordinating third-party reports (appraisal, environmental, title)
- Structuring collateral to meet lender risk thresholds without impairing operational flexibility
- Managing all SBA 7(a) program-specific requirements for authorization and approval
By delivering clean documentation and eliminating friction points, Cornovus Capital facilitated a smooth underwriting process and fast-tracked approval and funding within 45 days.
Results
Financial Flexibility and Growth Readiness: The new loan transformed the company’s financial outlook by reducing monthly debt obligations, extending the repayment term, and introducing much-needed liquidity.
- 30% reduction in monthly loan payments, improving day-to-day cash flow
- Working capital deployed toward new CNC equipment and hiring skilled labor
- Improved forecasting and debt visibility through a single repayment schedule
- No equity dilution—the entire capital stack was funded through debt
- Positioned for future SBA 504 or conventional capex expansion
About Cornovus Capital
With over 60 years of combined experience, Cornovus Capital is a trusted financial partner specializing in business financing, commercial real estate lending, and hospitality funding solutions. We design customized capital strategies that help businesses acquire, expand, and optimize operations, ensuring long-term growth and financial stability.
Our expertise spans SBA 7(a) and 504 loans, CMBS and LifeCo financing, private capital solutions, and structured debt strategies. By focusing on certainty of execution and closing assurance, we guide businesses and investors through complex financial landscapes, securing funding tailored to their long-term objectives.
Why Partner with Cornovus Capital?
At Cornovus Capital, we understand that complex transactions require sophisticated financing solutions. Whether you’re acquiring a business, buying out a partner, expanding operations, or combining real estate into a growth plan—we deliver capital strategies designed for certainty and efficiency.
What Sets Us Apart?
• Advisory expertise across business stages and sectors: We structure financing for acquisitions, expansions, partner buyouts, and practice ownership transitions.
• Innovative capital structuring: We integrate seller notes, working capital, CapEx, and goodwill financing into efficient, customized capital stacks.
• Lender alignment and competitive terms: We match each transaction with lenders who understand your industry—ensuring smooth approvals and favorable terms.
• End-to-end execution and advisory support: From deal modeling and loan packaging to lender communication and closing, we manage the entire process to ensure successful outcomes.
For business owners, professionals, and entrepreneurs seeking flexible SBA financing, Cornovus Capital delivers strategic insight, execution certainty, and long-term support.
Contact Cornovus Capital
At Cornovus Capital, we simplify the financing process with tailored solutions, competitive loan terms, and expert advice. Whether you’re acquiring, refinancing, or developing a property, we’re here to help you succeed.
📧 [email protected]
📞 513-653-4246
🌐 CornovusCapital.com