Dicom Transportation Group

Investment Amount: $7,250,000
Investment Date: October, 2017
"Our partnership with CapX provided our business the liquidity and flexibility we were looking for to align our continued growth and cost structure in an expeditious timeline."Scott L. Dobak, Chief Executive Officer, Dicom Transportation
"We value the collaborative relationship we have developed with CapX as a partner on these transactions and look forward to continuing to grow together."Michael K. Borrows, Chief Financial Officer, Dicom Transportation

Financing Opportunity

Dicom Transportation Group is a leading provider of expedited transportation and logistics services in North America, fulfilling over 80,000 shipments a day from their transportation hubs across Canada and the US. Wind Point Partners acquired Dicom in 2014 and started a series of strategic acquisitions in the U.S. aimed at creating a strong and unique inter-connected cross-border network for their customers. Dicom is predominantly an “asset-lite” business; however, managing substantial revenue growth with new account “wins” challenged margins as management looked to the use of short-term fixed asset rentals in certain areas of its integrated business offering. When their 2017 capital expenditure plan called for additional day cab trucks, straight trucks and forklift trucks balanced between Canada and the U.S., the Dicom management and Board chose to look outside of their multi-bank senior loan syndication in an effort to expedite an equipment finance relationship for the 2017 capital expenditure plan.

The CapX Solution

CapX, with its long-standing SBIC fund structure, had been precluded from funding assets outside the U.S. However, during the summer of 2017, CapX finalized its new commercial finance platform, Accord CapX LLC (“ACPX”), joining the Accord Financial family of companies (headquartered in Toronto, Ontario with U.S. asset-based lending offices in Greenville, SC). CapX then pitched Wind Point and Dicom to be the first cross-border portfolio company investment for ACPX. Four and five-year capital lease structures were offered to meet the liquidity and debt service needs for the company. The Master Lease balanced the legal and compliance requirements of both Canada and the U.S. with ACPX utilizing counsel for both jurisdictions. ACPX was able to meet Dicom’s accelerated funding needs, bumping up the original $5 million request to $7 million in a short time frame after the Company decided to go deeper with their “owned asset” strategy.

“CapX appreciates Wind Point’s confidence in our ability to expedite and provide certainty of funding in support of Dicom’s tremendous growth. We could not think of a more appropriate opportunity to showcase our new cross-border capabilities and initiate our new equipment finance platform as part of the Accord Financial family of companies."Jeffry S. Pfeffer, Managing Partner at CapX Partners, an Accord Financial company