Cen Cal Business Finance Group – a lender based out of Fresno – announced this week that it is merging with Bakersfield-based Mid State Development Corp.
The acquisition is pending approval from the U.S. Small Business Administration.
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The big picture: Both organizations offer loans guaranteed by the Small Business Administration by issuing debentures with terms of 10 to 25 years that are secured by a second trust deed.
- Mid State Development Corp. is worth over $71 million in loans, while Cen Cal Business Finance Group is over double the value with $160.7 million in loans.
- Mid State President Keith Brice will retire once the acquisition is completed, but the rest of the organization’s employees will remain on staff.
- This is the second acquisition by Cen Cal Business Finance Group recently, after having merged with Coastal Business Finance last month.
- Frank Gallegos, the CEO of Cen Cal Business Finance Group, will lead the merged company.
What they’re saying: Fresno Small Business Association Director Dan Golik said in a statement that the merger will create more opportunities for the Valley’s small businesses.
- “The merger ensures local businesses will have ongoing direct access to a host of Small Business Administration programs through what will now be a regional CDC located within the community,” Golik said.
- Gallegos said the lender will launch a micro-loan program to help communities that are not being served by either organization.
- “The new loan fund will be a completely privately funded revolving loan fund for existing Bakersfield small businesses,” Gallegos said. “Loans will range from $10,000 to $25,000 and can be used for equipment, working capital (or) inventory. We plan to hire local college interns to help work with clients to process the loans.”
