Flexport Capital, the commerce finance arm of third-party logistics supplier Flexport, introduced Thursday it has secured a $200 million credit score facility from insurance coverage accounts managed by international funding agency KKR to help continued geographic enlargement and improvement of extra monetary merchandise.
Flexport’s suite of economic companies supplies importers and exporters with entry to working capital for stock and logistics bills. Suppliers usually require upfront cost for items that may be caught on the water and land terminals for months earlier than they are often bought to generate money.
Flexport mentioned demand for commerce finance is excessive now with many companies sitting on an excessive amount of stock and struggling to pay distributors due to rising provide chain prices. An in-house financing line additionally supplies a liquidity choice for shippers because the financial system slows and lenders tighten entry to credit score.
The KKR (NYSE: KKR) credit score facility is the primary exterior funding for Flexport Capital since its inception in 2017. Flexport has financed over $1 billion in invoices for greater than 500 cargo house owners in additional than 20 international locations, with practically 150% year-over-year progress in its portfolio measurement. This yr it has expanded its mortgage choices to clients in 5 new areas: Canada, U.Ok., Netherlands, Belgium and Luxembourg.
As a digital freight forwarder, Flexport’s core energy is automating worldwide commerce processes and sharing knowledge in a central platform. Flexport Capital provides clients flexibility over conventional lenders as a result of it has deep perception of their enterprise fashions, buy order knowledge and cargo knowledge all the way down to the product degree. That knowledge helps Flexport make choices on when to increase credit score and to supply extra versatile phrases. Flexport additionally provides customizable compensation phrases.
“Flexport Capital started from the assumption that an organization’s provide chain needs to be a core aggressive benefit and progress enabler, not a working capital obstacle,” mentioned Justin Sherlock, head of Flexport Capita, within the announcement. “With deeper visibility into total provide chain well being, we may also help companies of all sizes — and their companions — to take away liquidity constraints within the midst of uncertainty. I’m thrilled to have KKR offering a credit score facility to assist us execute our imaginative and prescient to make international commerce simple for everybody.”
The KKR financing is likely one of the first main strikes Flexport has made since former high Amazon government Dave Clark joined the corporate as co-CEO on Sept. 1.
Click on right here for extra FreightWaves/American Shipper tales by Eric Kulisch.
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