The Company

An Oil & Gas Pipeline Services Company performing tests and inspections on welded joints for the construction of new oil and gas pipelines was experiencing strong growth. The Company, located in Alberta, Canada, is an affiliate of a U.S.-based firm with branch operations in the U.S., U.K., and Canada.

The Challenge

In 2021, the Company needed working capital to gear up for large contracts it received for a number of new pipeline projects coming online. Cash was needed to upgrade and repair equipment, and support the expanded payroll, benefits, and other staffing costs.

Why the Company Chose Hedaya

The Company’s management hired a consultant who introduced them to Hedaya. The consultant knew we were a good fit philosophically, though at the time we were not set up to factor Canadian operations. The Company appreciated our persistence and innovative approach and chose us because we understood their situation and knew how to help.

“Hedaya consistently worked from a position of ‘Let’s find a way to get this done.’ We appreciate their creative approach and willingness to go the extra mile for us.” – Company CFO

How Hedaya Capital Helped the Company

• Speedy Setup and Creative Solutions: We immediately met with our bank to expand our existing loan facility to enable us to borrow Canadian dollars. Additionally, we broadened our relationship with our re-factor to allow for the collection and management of Canadian Dollar receivables. With the help of our Canadian counsel, we were able to complete our due diligence and document the facility in under a month’s time. Hedaya is proud to have established a Canadian factoring platform in a very short period of time to provide a facility to meet the Company’s cash flow needs.

• Fuel for Growth: Hedaya Capital provided a CAD $2 million Factoring Facility, which enabled the Company to focus on growing the business and not be distracted by funding issues. By using their accounts receivable to fuel working capital, they now have the cash on hand needed to invest in new projects and people.

The Results

With the increased funding, the Company was able to support tremendous growth. They began factoring with us in May of 2021 and finished the year with CAD $15.2 million in revenue. For 2022, they were projecting $20 million in revenue but ended the year with $38 million, considerably exceeding projections. To accommodate the continued growth, we increased funding to the Company from $2 million to $3.5 million, helping them achieve an expected revenue of $50 million for 2023. We are proud to have provided the working capital support that enabled this company’s extraordinary growth!

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