AG RESOURCE MANAGEMENT COMPLETES LANDMARK SECURITIZATION FOR AGRICULTURAL FINANCE SECTOR

FORT WORTH, TX — Ag Resource Management (ARM), one of the nation’s top providers of agricultural lending and risk management services, announced that it successfully closed on the first securitization of its type in the agriculture industry. The 144A offering of $225 million crop loan backed notes serves as a milestone for ARM and the industry by accessing new sources of financing for ARM’s crop loan product.  Guggenheim Securities, LLC acted as sole structuring advisor and sole bookrunner.

“The past decade has been a challenging one for agriculture. Farmers need crop collateral solutions that work in a manner conducive to their success,” said ARM’s Chief Executive Officer, John Hoffman. He added, “Here at ARM, we are far from the norm. ARM is simply the smart choice for any farmer.”

The master trust securitization allows ARM to match fund its obligation to its farmers’ needs and to enable better execution, which will in turn allow further reach and more competitive capital solutions for the farming community.

“The successful completion of this inaugural asset-backed security transaction represents a significant milestone for Ag Resource Management in opening access to new sources of efficient capital that enables us to better serve the financing needs of farmers and agribusiness,” said ARM Chief Financial Officer and President of Capital Markets Rasool Alizadeh.

“Ag Resource Management’s goal has always been to keep farmers farming. It is a privilege for Guggenheim Securities to bring ARM to the debt capital markets through an innovative asset-backed security that helps ARM connect and partner with farmers across the country while also meeting the needs of the investor community,” said Cory Wishengrad, Head of Fixed Income for Guggenheim Securities.

The Secured Notes and the related note guarantees were offered in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”) and to non-U.S. persons in accordance with regulations under the Securities Act. The Exchangeable Notes and the related note guarantees were offered to qualified institutional buyers pursuant to Rule 144A under the Securities Act. The Notes, the related note guarantees and any shares of common stock issuable upon exchange of the Exchangeable Notes have not been, and will not be, registered under the Securities Act or any state securities laws. The Notes, the related note guarantees and any such shares may not be offered or sold in the United States or to, or for the benefit of, U.S. persons absent registration under, or an applicable exemption from, the registration requirements of the Securities Act and applicable state securities laws.

This press release does not constitute an offer to sell or the solicitation of an offer to buy the Notes or any other security and shall not constitute an offer, solicitation or sale in any jurisdiction in which, or to any persons to whom, such offering, solicitation or sale would be unlawful.

About Ag Resource Management

Founded in 2009, Ag Resource Management (ARM) is a specialty finance company bringing financial and risk management solutions to farmers and agribusinesses. Our teams are highly specialized in agricultural finance and crop insurance. We combine that with proprietary lending technology and a deep understanding of crop agriculture to build a customized strategy for every farming operation. It started as just one office in the Louisiana Delta, and now, headquartered in Fort Worth, Texas, ARM’s footprint has expanded to serve customers from 29 field locations in 18 states. They are led by experienced leaders in the agriculture industry who are committed to every operation’s growth and success.

Media Contact:

Matthew Marr
mmarr@armlend.com
682-302-3361

 

SOURCE Ag Resource Management

Ag Resource Management recently named Rasool Alizadeh as CFO & President of Capital Markets.

As CFO & President of Capital Markets, Alizadeh is focused on strategic funding and liquidity needs at ARM. Rasool joined from Ygrene Energy Fund Inc. where he served as Head of Capital Markets and Treasury focused on PACE financing. Rasool was also at SMBC Nikko Securities America, Inc. in the Structured Finance Group and was the head banker responsible for the term Asset Backed Securities (“ABS”) initiative focusing on new issue origination in autos, credit cards, student loans, and esoteric ABS including transportation (i.e. rail, aircraft, shipping, barge, etc.) as well as off-the-run specialty finance and CLO opportunities.

With 15 years structured finance experience, Rasool spent time with Standard & Poor’s (“S&P”), as a primary analyst in the ABS rating services group focused on esoteric mortgage related securitization and in the Residential Mortgage Backed Securities (“RMBS”) group focused on mortgage related new issue products. He also spent time at RBC Capital Markets (“RBC”) where he was an originator for both warehouse and balance sheet lending relationships as well as an original team member for the term ABS build-out. He has handled restructuring, investor relations, deal structuring and execution, rating agency processes, and portfolio management.

Key Takeaways:

  • Rasool provides and facilitates debt/equity funding and liquidity needs to specialty finance platforms. He provides financial forecasting and asset management for a newly established business and/or industry
  • He is a global banking and securitization professional with proven experience in lending, securitization, ratings, and debt/equity financing (syndicated loans/credit/working capital facilities)
  • Expertise includes identifying and analyzing credit risk, detailed due diligence, and deal execution within multiple asset classes
  • Rasool is a strong communicator with proven ability to creatively generate revenue through identification, coordination and marketing of products
  • He holds an M.B.A. from Columbia Business School, a B.S. in Business Administration from University of Denver, and B.A. in Economics from St. Lawrence University
  • Rasool spent 3 years playing professional soccer

It’s our pleasure to announce the promotion of Daniel Grube to Area Manager for Ag Resource Management’s Richland office.

Dan is a graduate of the University of Toledo, and went on to work in community, business and middle-market banking as an ag lender until joining the ARM team two and a half years ago. He grew up on a family farm which is owned an operated by his brother to this day. Dan enjoys being part of the ARM team because he gets to stay close to his first love in life—farming. He says, “My first love was farming, but I think I enjoy ag lending more now because I can do more with it, and the people I get to meet and work with is so vast now.  We’re helping farmers and agribusinesses flourish—not just in my home state of Ohio or where I work in Michigan, but nationally.”

Grube has held a few different responsibilities during his tenure at ARM thus far.  He came on board in a Senior Loan Officer role supporting three locations. When he transitioned to the Relationship Manager role in the fall of 2018, Dan started spending much of his time in Richland and ultimately supporting 100% of the Richland efforts starting in the fall of 2019. His energy, relationships and commitment to the ARM model will serve him well in his new role.  Dan’s leadership and skill set will allow for a smooth transition and we look forward to his continued success in his new role.

LOS ANGELES–(BUSINESS WIRE)– Ares Management Corporation (NYSE: ARES) (“Ares”) announced today that funds managed by its Alternative Credit strategy have provided a $450 million revolving asset-backed credit facility secured by agricultural production loans originated by Ag Resource Management (“ARM”).

ARM is a specialty finance company focused on bringing financial and risk management solutions to farmers and agribusinesses nationwide. By combining proprietary technology and a deep understanding of crop agriculture, ARM provides innovative agribusiness loan and crop insurance products that deliver operating capital to American farmers who seek financing for growing crops. Loans can be made directly to the producer or arranged in conjunction with a local distributor. The loans are secured by the crops, crop insurance and government payments instead of the farmer’s property or equipment, which is the case in traditional agriculture lending.

“Just as ARM has sought to fill the gaps of the agriculture lending market by providing unique and customized financial solutions for farmers, this investment demonstrates Ares’ ability to address similar gaps in the capital markets by providing unique asset-focused capital solutions for specialty finance companies like ARM,” said Joel Holsinger, Partner of Ares and Co-Head of Ares Alternative Credit. “We are excited to support ARM in its next phase of growth.”

About Ares Management Corporation

Ares Management Corporation (NYSE: ARES) is a leading global alternative investment manager operating three integrated businesses across Credit, Private Equity and Real Estate. Ares Management’s investment groups collaborate to deliver innovative investment solutions and consistent and attractive investment returns for fund investors throughout market cycles. Ares Management’s global platform had $144 billion of assets under management as of September 30, 2019 with approximately 1,200 employees in over 20 offices in more than 10 countries. Please visit www.aresmgmt.com for additional information.

About Ares Alternative Credit

Ares’ Alternative Credit strategy focuses on direct lending and investing in assets that generate contractual cash flows and fills gaps in the capital markets between credit, private equity and real estate. Ares Alternative Credit targets investments across the capital structure in specialty finance, lender finance, loan portfolios, equipment leasing, structured products, net lease, cash flow streams (royalties, licensing, management fees), fund secondaries and other asset-focused investments. Ares Alternative Credit leverages a broadly skilled and cohesive team of approximately 35 investment professionals as of September 30, 2019.

About ARM

ARM is a specialty finance company focused on bringing financial and risk management solutions to agribusinesses nationwide. ARM brings value to customers via the structuring of short-term financial risk. The Company provides crop production loans to meet working capital needs of producers as well as crop insurance to cover expected levels of production. Loans can be direct to the producer or arranged in conjunction with a local distributor.

Media:
Mendel Communications
Bill Mendel, 212-397-1030
bill@mendelcommunications.com
or
Investors:
Ares Management Corporation
Carl Drake, 800-340-6597
cdrake@aresmgmt.com
or
Priscila Roney, 212-808-1185
proney@aresmgmt.com

Source: Ares Management Corporation

This is the fourth and final blog in our Credit Crunch in Farm Country series. To start from the beginning, go to Part One – The Lay Of The Land.

The Outlook for 2020

Credit Crunch in Farm Country - The Outlook for 2020As a credit expert, Leroy Startz has one piece of advice he offers over all others: When it comes to getting financing lined up, the earlier the better.

To experts like him that means that the earlier you get financed the more likely you are to take advantage of opportunities that can positively affect the bottom line—like input discounts and possibly better deals on land rent if paid early.

“Generally speaking, those discounts are only provided to farmers pre-planting season,” Startz stresses. “If a farmer can get seed, chemicals, etc. and pay for them in advance, the distributor is likely going to give them a discount. That’s something you’d want to take advantage of.”

From general input discounts to measurable efficiencies, it’s clear how using an innovative lender like ARM could help an operator get ahead of the game:

“Perhaps landowners would be willing to give operators a little bit of a discount if I can deliver it earlier than what was expected or scheduled. If we can help the producer line up the capital he needs for the 2020 crop year well in advance, that allows them to take advantage of those discounts, and that’s huge. It might be the difference between making a margin and not making a margin. “

Do those recommendations translate into hard advice? Leroy Startz says yes:

“That’s the best advice I could give. Don’t wait to finance, and then give away those discounts. But of course, to get them, you have to get the capital lined up. You need to factor in the crop insurance into the equation as well. ARM can help you maximize the crop loan amount by having the right crop insurance coverage.”

The credit crunch in farm country is real, and it’s not going anywhere. The shifts Leroy Startz discussed are only going to continue to be the trend. From land ownership to capital control, all aspects are continuously evolving. However, lending models are catching up, and there are more solutions than ever to fund an operation. Now more than ever it’s apparent that farmers need innovators like Ag Resource Management to help them fill these gaps. It’s also apparent that those who do, will see real advantages in 2020 and beyond.

Credit Crunch in Farm Country

This is the third of four blogs in our Credit Crunch in Farm Country series. To start from the beginning, go to Part One – The Lay Of The Land.

Modern Ag Lending Solutions For Modern Ag Challenges

Credit Crunch In Farm Country - Modern Ag Lending Solutions For Modern Ag ChallengesLeroy Startz has no shortage of solutions for this credit crunch. He offers several traditional options that often work for farmers despite their limitations.

“Farm Credit is a resource that some are turning to, but they too, traditionally rely on land and equipment ownership as equity for those crop loans.”

Most farmers are more than acquainted with these traditional options. That’s why his largest concern lies in the fact that many operators don’t know that innovative, alternative options even exist for today’s grower. Finding purpose in this lending gap is a huge part of why he joined Ag Resource Management, an alternative, crop-based lender that understands the challenges of today’s operators.

“There’s a huge opportunity for a company like ARM to bring to light these alternative lending options that are more cash flow oriented using the future value of the growing crop without relying on equipment or land equity. That’s going to be huge going into 2020, especially after what we’ve experienced in 2019,” Startz says.

Is Alternative Agricultural Finance Cheaper Than Equity-Based Lending?

He’s aware that exploring alternative options can come with alternative risk. This begs the question—Does alternative agricultural finance come with a higher cost? Or is it possible that the use of alternative finance solutions may be cheaper than equity-based lending or other sources to free up capital?

According to Leroy Startz, it all depends on what you consider a true cost.

“With alternative lenders that are not hard asset backed, cash-flow lending has always been a little more expensive than hard asset lending’ he explained. “However, it’s not going to be any different in the alternative solutions that you’ll find in crop financing.”

This is why he fully supports alternative lenders like Ag Resource Management.

“We bring 100% financing to the budget of a farming operation so whatever the expenses are to operate my farm in 2020, assuming the farmer has actual production history available etc. and there’s a price and a crop insurance policy that justifies the budget to keep the farm productive. ARM is going to provide 100% financing. We don’t require equity in your land. We aren’t requiring liens on your equipment. It basically needs to be viewed as a combined debt and equity capital structure that enables the farmer to do what they do.”

In conclusion, when you look at the cost of alternative financing, you really have to look at what it would require and how much it would cost to go out and raise some equity to use as collateral to finance my operation. When you look at it on that basis, the weighted cost of capital, it’s actually not as expensive as it might first appear. As Startz says: “These loans are generally not outstanding for more than a year and the fact that you’re getting 100% financing is pretty compelling, especially when you don’t have to offer up a lien on land or equipment.”

Read more in the fourth and final part of our series: The Outlook For 2020.

Credit Crunch in Farm Country

October 28th 2019 – Englewood, CO

Ag Resource Management (ARM) recently held its Annual Summit for 2019 in Englewood, Colo. at the Inverness Hilton Hotel & Conference Center. Executive Chairman Brad Terral, President of Insurance and Field Operations Billy Moore, and President of Lending Mark Branch all made energizing opening remarks to set the tone for three days of intense learning and discussion. This was ARM’s opportunity to have all of its Market Leaders and Principal Insurance Agents in one place to unveil what’s ahead for the coming season. It was a winter wonderland in October for the team!

ARM has seen tremendous growth over the past year adding 12 new markets across the United States, bringing ARM up to 31 storefronts in 18 states. The company’s strategies and culture have evolved just the same, and the team is excited for what 2020 has to bring. Agriculture’s need for alternative financing solutions is greater than ever, a specialty ARM has mastered for years now. It’s time to put 2019 behind us, and get in focus for next year.

For more information about Ag Resource Management and what we do, please take a moment to explore our site. To get in touch with a Market Leader or Principal Agent nearest to you, visit our locations page. Whether you’re a farmer, banker, or ag retailer, we’d love to be your next capital partner.

Let’s grow.

November 7th 2019 – Fort Worth, TX

 

Ag Resource Management is excited to announce the addition of two Principal Insurance Agents to the team, expanding its footprint in the Crop Insurance sector.

 

Brian Long will serve as a Principal Insurance Agent in Crop Insurance for ARM’s Northeast Region. Long grew up on a corn and soybean farm in Central Illinois and attended Illinois College where he graduated in 2001 with a Bachelor’s in History. He has been in the crop insurance industry since 2005, during which the majority of his time was spent as a crop insurance agent covering Western Illinois and Eastern Missouri. Most recently Long left the AIP space as Regional Marketing Manager covering the Northeast Region from Illinois and Wisconsin  and on out to Pennsylvania.  Through part of his tenure as a crop insurance agent, Long was also a grain merchandiser and grain market advisor with a Series 3 and 30.  Long’s family operates an active grain farm in Central Illinois, which drives his strong desire to help farmers manage their risk. He and his family currently reside just outside of Franklin.

 

 

Billy Fanning will serve as a Principal Insurance Agent in Crop Insurance for ARM’s Northern Region. Fanning comes to ARM with over 20 years of crop insurance experience as a market leader and producing agent. He has worked with growers across the Midwest and Southeast, most recently writing crop insurance in the Carolinas and Virginia.  Growing up on, as well as farming full time, Billy knows and understands the risk farmers face today.  In his spare time he enjoys spending time with his wife, children and grandchildren.  He is an avid horseman and cattleman showing and raising cutting horses.

 

To learn more about how Brian or Billy can help optimize your operation’s risk management strategy, please contact them directly or at our offices in Springfield, Ill. and Saint Joseph, Mo. [Brian Long: (217) 318-3767, blong@armlend.com] [Billy Fanning: (816) 558-6182, bfanning@armlend.com]

 

On Thursday July 25, 2019 Ag Resource Management celebrated their ribbon cutting in conjunction with the Bad Axe Chamber of Commerce at 805 S Van Dyke, Bad Axe, Mich. 48413. There were many in attendance including chamber members, the Mayor of Bad Axe, law enforcement officers, WLEW Radio, Huron Daily Tribune, and residents of the Bad Axe community.

Left to Right: Kathleen Particka (Bad Axe Mayor), Pam Roestel (Customer Experience Specialist), Jill Miller (Market Leader), Scott Rueff (Northeast Regional Manager), Kelsey Brown (Chamber President and Marketing Specialist-Thumb Region at Team One Credit Union), Brett Mosher (Chamber Vice President and Law Enforcement Officer at the Huron Area Technical Center and Police Officer for Bad Axe Police Department and the Huron County Sheriff’s Department)

The addition of Bad Axe now doubles ARM’s presence in the state of Michigan. Jill Miller was hired as Market Leader back in January of 2019. She was born and raised in Huron County and attended school in Bad Axe and Kinde. She later attended Saginaw Valley State University graduating with a degree in Finance and Business Management in December of 2001. Miller has spent her entire career in the Bad Axe, Mich. community doing banking and agricultural lending. Miller’s involvement in the local community has consisted of Michigan Motosport Ministries, Bad Axe FFA parent advisory board, and many others. Miller comes from a farming background and lives on her husband’s grandparents’ farm. Miller has been married to Jeff for nearly 18 years and they have two children, Haley and Jack.

Working alongside Miller is Pam Roestel who was hired as the location’s Customer Experience Specialist. Roestel has spent the past 20 years in customer service as the head teller and new accounts lead for a local financial institution. She’s involved with the Bad Axe Chamber of Commerce, has served as the deputy clerk for her township for the past 28 years and runs their elections. Roestel is an active member of her church, choir, and a member of a women’s group serving in various offices. She is married to her husband Kevin of 35 years and they have three grown children and five grandchildren.

Pam Roestel (Customer Experience Specialist) and Jill Miller (Market Leader)

 

About ARM

Ag Resource Management is a specialty finance company bringing financial and risk management solutions to farmers and agribusinesses that serve farmers.