Franklin BSP Lending Corporation (FBLC) and Franklin BSP Capital Corporation (FBCC), business development companies advised by affiliates of Benefit Street Partners L.L.C., announced the acquisition of substantially all of the equity interests of Encina Equipment Finance, LLC (EEF), a non-bank equipment finance platform providing secured leases and loans to middle-market companies. The acquisition provides EEF with a capital base to support the continued expansion of its platform as a leading equipment finance solutions provider in the U.S. and Canada.
Encina Equipment Finance provides leases and loans secured by revenue-producing, essential-use equipment ranging in size from approximately $5 million to $50 million to middle-market, non-investment grade companies across a range of industries. Since its inception in 2017, EEF has underwritten more than 125 transactions totaling over $1 billion in cumulative funded volume.
Encina Equipment will continue to be led by Rick Matte, its President and CEO, and remain headquartered in Westport, CT. As part of the transaction, members of the management team will retain a minority ownership interest in EEF. Encina Equipment Finance will operate independently as a portfolio company of FBLC and FBCC.
In connection with this announcement, Matte said, “We are excited to embark on our company’s next stage of growth and look forward to collaborating with BSP to continue to provide critical equipment financing solutions to our clients. BSP’s credit expertise and cultural fit, combined with a permanent capital base, make it an ideal partner for EEF. The management team and I are also incredibly appreciative of the foundation and support we have received from our founding partners at Encina Capital Partners and funds managed by Oaktree Capital Management, L.P. to position our firm for this next phase.”
“EEF represents a compelling investment opportunity for our two BDCs,” said Richard Byrne, President of BSP and CEO of FBLC and FBCC. “The Encina Equipment team has built a best-in-class equipment finance platform that is well-positioned for continued growth. EEF complements our core private debt business and broadens the suite of financing solutions across our platform. We are excited to partner with Rick and the rest of the EEF team.”
Andrew Salter, Founder and CEO of Encina Capital Partners, said, “I am grateful for the tremendous support that we’ve received from funds managed by Oaktree Capital Management, L.P. and our lender group as well as the significant contributions from my partners Willie Brasser, Ron Fontana and Jason Wolff, and I’m confident that EEF is well-positioned for a highly successful next chapter with BSP.”
BofA Securities served as exclusive financial advisor to FBLC and FBCC. Wells Fargo Securities, LLC served as exclusive financial advisor to EEF. Skadden, Arps, Slate, Meagher & Flom LLP and Reed Smith LLP served as legal advisors to EEF. Hogan Lovells US LLP, Dechert LLP and Ropes & Gray LLP served as legal advisors to BSP.