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Private Equity Sponsors

We understand how receivables and payables transactions can be structured to fit within the capital structure of highly leveraged corporates.

These facilities can be used to significantly reduce cost of debt and provide incremental liquidity to support reduced leverage or growth.

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We have executed a number of transactions in support of private equity portfolio companies.

Whilst challenging to put a facility in place alongside the acquisition financing,  transactions can be accommodated within financing documentation (senior facility agreements; high yield bond indentures etc.) for implementation following completion of the acquisition.

Capital realised through a working capital facility can be used to generate liquidity to support growth and potentially to refinance other forms of funding.

Larger corporates with cross border financing requirements are strong prospects for Demica with scope to implement Receivables transactions for corporates with operating companies across Europe, North America, Australia and selectively in Asia and South America.

 

Facilities can be structured to be “portable” with scope to survive change of control provisions which can be highly accretive given the lower cost of debt attributable to these facilities as compared with traditional sources of leveraged finance.

Transactions of over $100m are typically placed with large established securitisation investors.  Our own financing vehicle, MORE Finance caters for transactions of  between €30m – 75m.

It may be possible to structure Supply Chain Finance transactions for sub-investment grade companies through our in depth knowledge of the investor market and ability to structure credit insurance backed facilities. Often the cost of these programmes will be covered by the buyer through a “gross up” structure and can enable further improvement in the company’s cash conversion cycle.

 

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