Equipment Sale-Leaseback
A structure where an operator sells owned equipment to a funder and immediately leases it back, converting a fixed asset into working capital while keeping the equipment in use.
When it makes sense
Sale-leaseback works when the equipment has meaningful market value, the operator needs working capital, and the cost of leasing it back is lower than the alternative sources of capital.
It is most efficient on equipment with a long remaining useful life and a deep secondary market: kitchen lines, refrigeration, manufacturing equipment, transportation rolling stock.
Related Entries
See how this structure is used in practice.
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