Cloud 9fin Turning working capital into liquidity with SLR’s Mitch Soiefer
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Feb 11, 2026 Mitch Soiefer, partner and head of lender finance at SLR Capital Partners, specializes in asset-based lending and working capital finance. He explains carving out receivables and inventory to unlock liquidity. He walks through SPVs, first-lien structures, and underwriting checks. He outlines which companies fit these ABL carve-outs and why the trend rises late in the credit cycle.
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Working Capital Carve-Outs Defined
- Carving out working capital means raising new secured financing specifically against accounts receivable and inventory separate from a company's existing cash-flow loan.
- This creates incremental liquidity without refinancing the entire capital structure.
Why Carve-Outs Are Resurgent
- Carve-outs are not new but become more common late in economic cycles or when refinancing tightens.
- Higher rates and slower refinancing drove recent upticks in these transactions.
Structure Carve-Outs With First Lien Security
- Structure carve-outs with a first‑priority lien on receivables and inventory and use intercreditor agreements when needed.
- Set up an SPV or direct security so the new lender controls those working capital assets.