€120M Cross-Border ABL for Nordic Carve-Out
Revolving ABL with a pan-Nordic borrowing base, 85% AR / 65% inventory advance rates, €15M seasonal overadvance, and a 5-year term—supporting an industrial carve-out across three jurisdictions.
Deal Overview
The Challenge
A Nordic-focused sponsor carved out a regional manufacturing business operating across three countries, requiring a working capital facility aligned to seasonal inventory and receivables cycles—and executable without trapping liquidity by entity.
Key complexity factors included:
- •Cross-border borrowing base requiring coordinated collateral eligibility, reserves, and monitoring
- •Different security and perfection regimes under Swedish, Norwegian, and Danish law
- •Seasonal volatility with peak working capital demand during the production cycle
- •Field examination and appraisal requirements across multiple sites and jurisdictions
Our Solution
We structured a €120M revolving ABL with an aggregated Nordic borrowing base, clear advance rates, and reporting mechanics that matched how the business actually operates.
Structure
- →Pan-Nordic borrowing base aggregating eligible receivables and inventory across Sweden, Norway, and Denmark
- →Advance rates of 85% on eligible AR and 65% on eligible inventory (after customary reserves)
- →€15M overadvance to bridge seasonal peaks without restructuring the facility
- →Springing fixed charge covenant tied to overadvance usage
Execution
- →8-week timeline with coordinated Swedish, Norwegian, and Danish counsel and security opinions
- →Field exams and inventory appraisals completed pre-closing across manufacturing locations
- →Enterprise asset pledge (Swedish företagshypotek) with aligned Norwegian and Danish security
- →Automated borrowing base reporting integrated with ERP for timely availability
Deal Structure
Borrowing base
Covenants
- •Fixed charge coverage: 1.1x (springing)
- •Reporting: Weekly borrowing base certification
- •Field exams: Bi-annual across jurisdictions
- •Appraisals: Annual third-party inventory valuations
Key Documentation
ABL Credit Agreement
Revolving facility with cross-border borrowing base mechanics, Nordic-tailored eligibility criteria, reserves, and overadvance provisions.
Security Package
Swedish företagshypotek and aligned Norwegian and Danish charges, with account control arrangements on collection accounts where required.
Intercreditor (ABL / Cash Flow)
Intercreditor between the ABL and a covenant-lite term loan, covering priority, permitted payments, and enforcement standstills.
Borrowing Base Certificate
Weekly certificate template with ERP-linked reporting, dilution tracking, and concentration limits by customer and jurisdiction.
Transaction Timeline
Collateral & term sheet
Collateral assessment, initial field work, and agreed ABL structure and advance mechanics
Due diligence & documentation
Facility documentation, diligence, and borrowing base modeling across three jurisdictions
Security perfection
Execution and perfection steps under Swedish, Norwegian, and Danish law with local counsel sign-off
Closing
Closing, initial availability, and borrowing base reporting go-live
Outcome
The facility closed on plan, giving the business predictable liquidity through seasonal swings while preserving a clean cross-border collateral framework.
Post-closing benefits:
- •Seasonal flexibility: Overadvance supported peak working capital needs without ad-hoc waivers or emergency amendments.
- •Operational efficiency: Automated borrowing base reporting reduced manual workload and improved real-time visibility of availability.
- •Cross-border optimization: A single aggregated base improved cash efficiency versus siloed, jurisdiction-by-jurisdiction facilities.
Discuss your financing needs
TULA Capital supports complex cross-border financing across jurisdictions and asset classes.
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