Comvest Capital is a private investment firm focused on providing equity and debt capital to lower middle-market companies. Caliber provides fair value services to establish the fair values of various debt instruments and mezzanine debt investments made by Comvest Capital in private companies in accordance with ASC 820. The debt instruments include term loans, revolvers and convertible debt, and the mezzanine investments include warrants, collared warrants, puts and other hybrid instruments.
Caliber has developed credit rating models for the private companies based on financial and market metrics to determine the credit spread applicable to the investment. Caliber also measures the additional illiquidity spread, known as the z-spread, that is observed in these investments to establish the fair value specific to small cap C&I loans. (The z-spread is the additional return provided to the lender as compensation for the illiquid characteristics of the investments. Calculated z-spreads typically range between 3 and 10 percent.)
The valuation analysis provided by Caliber is used by Comvest for financial and tax reporting purposes.