Small World Kids, Inc. (“Small World”) is a leading designer, manufacturer, marketer and distributor of high-quality, award-winning children's products
The Company was looking to raise both debt and equity capital to expand its already strong presence in the discovery, creative and imaginative play categories through acquisitions
Challenges
Hurdles in consummating a transaction included:
The Company’s stock traded publicly but had a relatively small public float
The Company’s current financial position did not fully reflect the earnings potential of recent acquisitions
Uncertainty surrounding public market reception for the issuance of new equity required a flexible debt financing solution
Solution
FocalPoint developed a short list of hedge funds with the capability to provide both senior and junior capital in a wide range of structures
FocalPoint spent time assisting financing sources with their understanding of the unique aspects of the retail environment for the toy industry
Small World was able to secure attractive financing that provided the capital required to fund its expansion and the flexibility with its final capital structure should the reception of the public equity markets provide for a less than optimal issuance of new equity
