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LENDER OF THE YEAR
NXT Capital

For CEO and founder Robert Radway, the firm's consistency since it burst onto the scene two years ago is simply an extension of what his team had always done in their years together at Heller and Merrill

Comprised of Heller Financial alumnae, NXT Capital Inc. has quickly become one of the most active lenders in the middle market. Over the course of 67 transactions, the Chicago firm's nine directors represented roughly $1.6 billion in commitments in 2011. Impressive, especially when held up against GE Capital Americas and its 60,000-plus employees worldwide, which had 91 transactions and represented $7.5 billion. Indeed, NXT's star is rising, and it didn't take long.

Once Heller was sold to GE Capital for $5.3 billion in 2001, those future NXT directors went on to Merrill Lynch Capital until that too was sold to GE in 2007 for $1.3 billion. In May 2010, they formed NXT-a third act in the eyes of its chairman and CEO Robert Radway.

"We see quite a number of sponsors making one of their first calls to NXT. That is a statement that they are reaching a responsive chord."

"A lot has to do with the quality of the team and the continuity of that team," Radway says. "Not as a startup but as a restart-many of the things that make us known and appreciated by the sponsors we work with, carried over to here."

Private equity firms agree. "Like Heller, NXT has consistency in both marketing and credit discipline," New Caanan Partners' Earl Mix says.

NXT has served 34 different sponsors and acted as lead agent, co-agent or titled agent in 83 percent of its transactions. That's not an easy feat. Senior debt capital was going through a severe dry spell, but NXT was the exception. The firm touts its ability to pull through either at the last minute, or when other lenders fail to cooperate. Recall when Palladium Equity Partners purchased Abra Auto Body & Glass, late last year. In the final weeks, Palladium didn't have a senior credit facility available, and the exclusivity period for the New York-based firm was about to expire. Enter NXT. Within two weeks, NXT secured an $82.5 million senior credit facility and wrapped up the deal.

NXT also provided an $18 million senior credit facility to fund Prairie Capital's growth equity investment in Navman Wireless Holdings, a Glenview, Ill. company providing GPS-enabled solutions to school-bus fleets. Several lenders failed to build a consensus, and NXT was the sole arranger for the transaction.

A similar situation occurred when Atlanta-based MSouth Equity Partners was looking to acquire Education Networks of America Inc., tapping three lenders to complete the financing. NXT ended up underwriting the entire transaction on its own. These case studies make NXT a favorite among private equity firms, despite competition from Madison Capital Funding, GE Antares and BMO Harris. "We see quite a number of sponsors making one of their first calls to NXT - that is a statement that they are reaching a responsive chord," adds Mix.

For Radway, NXT's consistency since it burst onto the scene two years ago is simply an extension of what his team had always done in their years together at Heller and Merrill. Even the name "NXT" underscores what the company is all about. "We wanted something that meant something to us," he says. "The 'next' iteration of something that had been very successful."