Financial Group

Raw Material Producer for Oil & Gas Industry

The company requested an extension of $2 million USD with Expocredit because they reached a commercial agreement with a new debtor

Deal Summary

Product
Factoring
Funding Line Amount
$2 millions USD
Company Type
Oil and petrochemicals
Industry Type
Oil and gas
Location
United States
This company has led the oil market for 20 years. Since its founding in Texas in 2001, it has positioned itself as a global reference as an integrated trading company that participates in the commercialization of crude oil condensates, naphtha, distillates, gasoline components, petrochemicals, and thermoplastic resins. The company has presence in 16 different countries, with important participation in Switzerland and Singapore.

Despite the ravages caused by the pandemic as result of Covid-19, the company invoices between $50 million USD to $100 million USD per month during its busy season. This transaction level is maintained due to its high offer for different industries, and thanks to the fact that it has more than 100 different product lines.

Challenge

By the end of 2020, this company was able to maintain a good sales rhythm and slightly improve its financial results, with earnings close to $11 million USD. However, despite the high turnover, the company has capital needs to cover sales of more than 30 days with clients located in Latin America.

This is a company with great financial results, but which faces a competitive market but with low net profits. For this reason, Expocredit has collaborated with 14 debtors of the company to maintain the cash flow that is needed to fulfill its obligations. In this way, the client continues to remain operational while reaching agreements that ensure future incomes and not immediate ones.

Solution

The company requested an extension of $2 million USD with Expocredit because they reached a commercial agreement with a new debtor. Through this new agreement, the financing will be acquired by the new enterprise’s debtor, including the charges generated by the factoring service received.

Expocredit understands the difficulties when expanding the agreement due to the difficult market situation and the client’s time with this type of exercise. Despite this, it is understood as a simple operation that gives the opportunity to a client with an excellent payment performance.