Commercial Credit Inc. has filed a Form S-1 with the U.S. Securities and Exchange Commission (SEC) for an initial public offering (IPO). As this was the first filing, there was no pricing information, but the offering is expected to be valued up to $100 million. The company will list on the New York Stock Exchange under the symbol CCR.
J.P. Morgan and Keefe, Bruyette & Woods are serving as joint book-running managers and as representatives of the underwriters for the offering.
Commercial Credit is an independent financial services company engaged in the financing of commercial equipment. The company provides secured loans and leases to businesses that operate in the construction, fleet transportation and waste industries in the United States and Canada.
Its target customers are primarily middle-market, family-owned businesses. The company’s equipment includes mobile cranes, earth moving and paving equipment, over-the-road trucks and trailers, waste collection trucks and related equipment that are produced primarily by nationally recognized manufacturers.
Note that Commercial Credit does not rely on marketing programs with equipment vendors or manufacturers to source new business.
Commercial Credit was founded in October of 2004. It has directly originated $1.9 billion of loans and leases. At the end of December 2014, the company had a finance receivables portfolio of $611.5 million, consisting of over 3,900 loans and leases to more than 1,800 customers.
Commercial Credit typically originates loans and leases that range from $50,000 to $2.5 million per transaction. For the nine months ended December 2014, the average new contract was roughly $209,000, and had an original term of 46 months with a yield of 9.8%. The company retains all of its originations and holds them to maturity.
The company intends to use the net proceeds from this offering to retire the outstanding aggregate principal amount of its 12.75% senior subordinated notes due 2018 in the amount of $33 million, plus any interest and fees, and for working capital and general corporate purposes. Commercial Credit may also pay down its credit facilities with the proceeds.
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