Click here for Corporate Application  
Contact Customer Service  Site map

Click here to print directions to our
Corporate Offices or click here for PDF format

Advantage Funding In The News

 

Carey™ Driving Success

Advantage Funding Commercial Transportation Leasing & Finance

ADVANTAGE FUNDING AND CAREY INTERNATIONAL ANNOUNCE
STRATEGIC PARTNERSHIP FOR CHAUFFEUR FINANCING

LAKE SUCCESS, NEW YORK, February 1st, 2010 - Advantage Funding and Carey
International announced a strategic partnership to provide vehicle financing for Carey
chauffeurs and franchisees.

Access to funding for professional drivers has been severely impacted by the current
credit crunch, this relationship will enable Carey franchisees to update their fleets by
providing access to vehicle financing that would otherwise may not be available.

“We continuously look to add value for our chauffeurs, independent operators, and
franchisees and sought out a finance [alternative] opportunity that could accommodate
those needs,” said Gary L. Kessler, Carey President and Chief Executive Officer.
“Advantage Funding is a world class finance organization that has intimate knowledge of the ground transportation industry. By adding this valuable option, the credit availability issue for many of our chauffeurs may be solved, thus allowing for regular updating of the fleet.” he added.

“Advantage Funding has committed substantial resources to this partnership and we
believe there is opportunity to increase livery lending to good operators,” said Edward P. Kaye, President of Advantage Funding. “Operators now have an easy and cost effective way to update and replace aged equipment and continue to provide Carey customers with the superior service they are accustomed to,” added Kaye.

Advantage Funding is a leading non-captive commercial vehicle leasing and financing
company to the ground transportation industry and is a Marubeni Group Company, the
multinational general Japanese trading company founded in 1858 with over 5500
employees in 70 countries throughout the world.

Carey International is the world's leading chauffeured services company founded in 1921 with market-leading chauffeured service providers in 65 countries and 550 cities
spanning the globe.

For more information contact Darren Martin, Account Representative, 516.280.1374,
dmartin@advantagefunding.us

---

The Secret of Our Success Published February 8, 2010

"I think Advantage Funding is the industry leader in ground transportation finance. PFSC has had the pleasure of working closely with Advantage and has thoroughly enjoyed watching and participating in their success. As a Marubeni Group Company, Advantage Funding has been insulated from the turmoil in the capital markets, allowing them to remain a consistent and reliable financing source in the markets they serve. While many equipment finance companies have faltered, Ed Kaye and his partners have continued to improve upon their leadership position in the leasing industry."
John Enyart, President, Portfolio Financial Servicing Company (PFSC)

Eric C. Coolbaugh, Vice President; Michael P. Kaplan, Secretary Treasurer; Edward P. Kaye, President

Nobody says they want to go into the leasing business when they grow up. But for the three partners that started Advantage Funding, it worked out well.

After 10 year careers with a large independent auto leasing firm, the three account representatives, Edward Kaye, Eric Coolbaugh, and Michael Kaplan found themselves without a home. Their employer decided to relocate from their native New York City to Florida and the three did not like the way the business was heading and decided to start their own firm, Advantage Funding.

“In hindsight, it was the best move of our lives,” says Kaye, the current president and a principal of Advantage. “We each kicked in $7,500, rented a small office, purchased an inexpensive phone system and made cardboard boxes our desks,” he added. “We were very young, worked very hard and had fun every day,” he stated.

“We started out as brokers for the first several months with existing bank and leasing company relationships and quickly realized that we needed recourse leasing lines to grow the business,” said Eric Coolbaugh, vice president and a principal. “The first lender to provide a warehouse line of credit was Ford Motor Credit,” he added. In the late 1990s it was relatively easy to obtain bank lines and the three were able to leverage lines with All Points Capital (now a subsidiary of CapitalOne Bank), Sovereign Bank (now Banco Santander), European American Bank (now Citigroup), and New World Lease Funding, which was all they needed to grow their modest investment into an $80 million portfolio.

With good portfolio performance and disciplined buying habits the company steadily grew, adding staff and eventually moving to larger offices with real desks and furniture. “Although it certainly was not what many people expected to see when they walked into our office, a converted two story dye house in an industrial neighborhood, we called it home. We never believed in investing a lot of capital in window dressing,” said Michael Kaplan, secretary treasurer and a principal. “We always had the same goal of investing in the business for the long term,” he said.

Advantage Funding specializes in direct and indirect niche transportation finance and leasing. Their target transactions are leases and loans of new and used commercial coaches, minibuses, school buses, paratransit vans, ambulances and limousines. They also establish captive finance programs for commercial transportation equipment manufacturers. They do not fund trucks, trailers, or any collateral with residual value risk.

“In 2001 business was very good. New business volume was up, delinquency was down, and we had healthy margins. Then 9/11 happened,” Kaye says.

At the time Advantage was the largest independent finance company to the Black Car industry (prearranged chauffeured sedan transportation) in the City of New York. “We suffered enormous losses but didn’t panic,” Coolbaugh says. “We created special finance programs to liquidate the repossessions,” he added. “We kept the banks informed of our activity, they supported us, and it worked out,” Kaplan says. All of Advantage’s lenders were paid 100% on the dollar after 9/11, according to Kaye.

In 2006, the company caught the attention of Marubeni America Corporation (www.marubeni-usa.com), the North American subsidiary of Marubeni Corporation (www.marubeni.com), the multinational Japanese trading conglomerate. “We were still happy doing what we were doing but decided after 9/11 that having a large partner had its benefits,” Kaplan says.

The main concern for Advantage was management and existing employees remain in place after the acquisition. Marubeni agreed, according to Kaye, and they purchased a majority stake in the company. “Marubeni immediately lowered our internal cost of funds and provided treasury and financial support services that otherwise would not be available to us,” Coolbaugh says.

With Marubeni’s backing, the company self funds all of its transactions and has grown the portfolio to over 4,000 vehicles or $300 million. Marubeni’s involvement was important in growing the business but the three partners give equal credit to their loyal and dedicated sales people, back office staff, and customers.

“We have worked with many of our sales people and employees for close to 20 years. They have devoted their lives to our business and we are fortunate to have such long standing relationships with them,” Kaplan says. “Many of our customers have been with us for 20 years as well,” added Kaye. They were loyal to us before Advantage was formed and stayed with us,” he said.

The three partners function as one unit in managing the daily operation. Given the current challenges the economy is experiencing, the three have a clear direction in how to lead the company through this cycle.

“We each bring something unique to the table and respect each others’ opinions. This is what makes the partnership, and ultimately the company strong” Coolbaugh says. In today’s economy there are a lot of issues to deal with and it helps that we have a clear direction and understanding of what it takes to succeed in difficult times.” “It’s hard enough battling customers, we do not want to spend any energy battling your partners,” Kaplan says.

Advantage has 10 salespeople strategically located throughout the United States and 30 employees in its corporate headquarters in Lake Success, Long Island, New York. The portfolio is serviced by the third party servicing agent, PFSC of Portland, Oregon.

“When we look back at what we’ve accomplished and how we got here, it makes you realize how lucky we have been in a career we each fell into,” Kaye says. “We’ve come a long way and we could not have planned it better.”

Edward P. Kaye, President; Eric C. Coolbaugh, Vice President; Michael P. Kaplan, Secretary Treasurer

You may also view this article at Leasing News Online

Current Issue

Advantage Funding Adds McCready to Asset Department, Lyons to Sales March 18. 2009

The Advantage Funding group of companies announced that Robert McCready has been hired as asset control coordinator and Darasue Lyons has been hired as a sales assistant.

"We are pleased to add Bob to our asset department. With over 30 years of experience in banking, transportation finance, and leasing, he brings a wealth of experience and knowledge in our niche markets and the necessary skills to succeed in these trying economic times," said Christopher Brown, asset manager.

Prior to joining Advantage Funding, McCready worked as the operations manager for Tilden Commercial Alliance, and the asset and funding desks at USA Financial, Citibank and European American Bank (EAB).

"Darasue brings years of experience in operations and funding, she will be an enormous asset to supporting our sales department," said Rose Zerillo, operations manager.

Prior to joining Advantage, Darasue held positions with All Points Capital Corp., European American Bank and New World Lease Funding.

Advantage Funding is a market leading noncaptive ground transportation finance and leasing company, and is a subsidiary of Marubeni America Corporation.

Wednesday, March 18, 2009

Wall Street Journal

January 6, 2009
By YUKA HAYASHI

TOKYO -- Japan's cash-rich trading companies, such as Marubeni Corp. and Itochu Corp., are on the hunt for bargain acquisitions outside Japan, seizing the opportunity to expand abroad while the stronger yen makes purchases cheaper and potential competitors are sidelined by the credit crisis.

The conglomerates, which do everything from develop oil fields in Russia to import designer handbags to Japan, have been active in mergers and acquisitions. Japanese companies in total spent $77.8 billion last year on acquisitions outside Japan, more than triple the amount spent in 2007 and exceeding the previous annual record of $52 billion set in 2006, according to market data provider Dealogic.

"Hard times often come hand in hand with opportunities," said Teruo Asada, president and chief executive of Marubeni, Japan's fifth-largest trading company by market cap. "For healthy Japanese companies, this is truly an excellent chance to plant the seeds for the future."

Investment bankers expect acquisitions to continue this year, although the pace may slow as companies become more cautious on prices.

For companies from other major nations, 2008 was a slow year. U.S. companies, for example, spent $188.6 billion on acquisitions of non-U.S. companies, down 26% from 2007. Those in the U.K. spent $101.8 billion, down 67%, according to Dealogic.

Japanese companies are in a strong position to make overseas acquisitions for a few reasons. After years of restructuring, Japanese firms are sitting on about $1.25 trillion in cash.

In addition, the companies' purchasing power has increased as the yen rose about 25% against a basket of currencies in 2008, while falls in the global markets have meant shares of many potential targets have dropped.

Marubeni and Osaka Gas Co. are considering jointly investing in an electricity and water project in Abu Dhabi after French energy giant GDF Suez SA failed to secure enough funding from European banks to finance the project, according to Mr. Asada.

Two of the most acquisitive trading companies have been Marubeni and Itochu. Marubeni, a 150- year-old company that started as an Osaka kimono merchant, conducted 13 M&A deals in 2008, including the purchase of a power company in Singapore, copper mines in Chile and a service provider for steel mills in Pittsburgh, according to Dealogic.

Marubeni Corp.
Teruo Asada, president and chief executive of Marubeni

In the current fiscal year ending March 31, Marubeni expects to spend 320 billion yen to 330 billion yen ($3.5 billion to $3.6 billion) in new investment, Mr. Asada said, compared with 300 billion yen in the previous fiscal year.

Mr. Asada said Marubeni's acquisitions are usually made in areas where the company already has expertise, such as energy, commodities, food and machinery. And rather than sending bankers out to identify potential acquisitions, Marubeni usually finds opportunities through its existing business relationships.

The CEO said Marubeni has set aside 600 billion yen for new investments for the two-year period ending March 31, 2010, which is about the same amount spent in the previous two-year period. Despite the sharp slowdown in the global economy, the company has no plans to reduce its spending, Mr. Asada said.

Itochu, Japan's fourth-largest trading company by market cap, in November spent $710 million for a 20% stake in Chinese food distributor Ting Hsin Holding Corp. After large deals in late 2008, including several in energy and mining industries, Itochu could end up shelling out as much as $4.4 billion by the end of the fiscal year in March, the company said, exceeding its plan at the beginning of the fiscal year to spend about $2.7 billion.

There are risks in the trading companies' aggressive strategy. Marubeni's Mr. Asada says the operating environment for the company has rapidly deteriorated in recent weeks as the sharp drop in oil and commodities prices pushes down its revenue, though it hasn't yet altered its profit forecast for the fiscal year ending in March.

A global slowdown will mean lower revenues overall, and a higher yen, while making foreign
investments cheaper, will reduce the companies' overseas profits when converted back into yen.

Japanese lenders, which were relatively sheltered from the global credit crunch until recent
months, have started to tighten access to credit. The volume of acquisition financing fell by twothirds in the final three months of the year and was down 8% year on year.

Food manufacturers and other companies who sell mainly to Japanese consumers are most able to wear the effects of the economic downturn and are most likely to continue making acquisitions, said Masaru Shibata, head of M&A in Japan for J.P. Morgan Chase & Co.

Many consultants and advisory firms are keen to help the Japanese manage companies abroad effectively. One such firm is regional fund, Barings Private Equity Asia K.K., which is hoping to invest jointly with Japanese companies or sell them companies.

"Japanese firms have approached us to talk about buying two of our portfolio companies in
South-East Asia. The Japanese seem to be one of the few groups of active buyers out there," said Barings' managing partner Jean Eric Salata.

Marubeni, for its part, says it will continue to look for new investments in growing industries in key regions. In Asia, infrastructure businesses like electric power, transportation and water treatment offer opportunities because these are areas in which demand is growing and where Marubeni can make use of its expertise.

"The U.S. has shown lots of flexibility in implementing monetary and fiscal policies" to help prop up its struggling economy, Mr. Asada says. "When their effects kick in and the economy begins to recover, the markets in the U.S. will be very attractive."

—Alison Tudor contributed to this article.
Write to Yuka Hayashi at yuka.hayashi@wsj.com