CapitalSource Announces Retail Finance Deals with Fetco Home Decor and Crosstown Traders

Business Wire,  Dec 16, 2002  

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Business Editors

CHEVY CHASE, Md.--(BUSINESS WIRE)--Dec. 16, 2002

CapitalSource, a leading commercial finance firm headquartered in Chevy Chase, Md., today announced that it has completed two financial transactions through its Retail Finance Division: Fetco Home Decor, the country's second largest importer and distributor of picture frames, and Crosstown Traders, a direct marketer of women's apparel and specialty gifts.

CapitalSource has provided Fetco $5 million in junior subordinated notes. The loan provided for a refinancing as well as for working capital, to expand Fetco's product line and for additional growth. CapitalSource teamed up with Congress Financial Corp. in the transaction totaling $20 million.

"Fetco has historically been cash flow positive, and they were looking to find new ways to expand," according to Andrew H. Moser, national group leader of CapitalSource's Retail Finance division. "We were able to offer a flexible financing package that will enable Fetco to diversify its product line and to expand its relationship with larger retailers."

"CapitalSource showed unique flexibility and knowledge of the industry in working with our investors and advisors in order to facilitate the improved capitalization of our business," said Nancy Babine Kucinski, Fetco CEO.

The privately held Fetco's corporate headquarters is located in Randolph, Mass. The company also has offices in Bangkok and Hong Kong.

Under the terms of the Crosstown Traders deal, CapitalSource has provided a $20 million senior subordinated term loan in connection with JPMorgan Partners' recent acquisition of the company from Federated Department Stores.

"Crosstown Traders has a solid management team, strong brand, and stable financial backing," said Moser. "Our financing package enables Crosstown to expand their retail divisions, increasing their economies of scale."

The catalog company's women's apparel and accessories titles include Old Pueblo Traders, Bedford Fair, Willow Ridge, Lew Magram, Brownstone Studio, Regalia Intimate Appeal and Coward Shoes. Crosstown's food and specialty gift titles include Figi's and JF Collection.

About CapitalSource

CapitalSource is a one of the leading commercial finance companies in the United States. The company offers senior and mezzanine financing ranging from $2 million to $50 million to small and mid-sized borrowers through three focused lending units: Corporate Finance, Healthcare Finance, and Structured Finance.

CapitalSource has $511 million of committed equity capital and over $2.5 billion in funding capabilities.

The Corporate Finance team principally focuses on providing senior and mezzanine debt to companies with private equity sponsorship. As appropriate, the team can blend its senior and mezzanine capabilities to finance the entire transaction. CapitalSource can also make equity co-investments to help support the transaction.

Headquartered in Chevy Chase, Md., CapitalSource has a full-service office in San Francisco and satellite offices in Boston, Chicago, Dallas, Los Angeles, New York and Philadelphia. The company has 147 employees. For more information visit www.capitalsource.com or call toll free 866-876-8723.

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