CORPORATE DEBT FINANCING FOR ROMANIAN SME

Transcription

1 CORPORATE DEBT FINANCING FOR ROMANIAN SME S Solutions offered by CVI Dom Maklerski June 2018

2 ABOUT CVI CVI IS AN INDEPENDENT POLISH PRIVATE DEBT COMPANY, ONE OF THE LARGEST INVESTORS IN THE REGION OF CENTRAL AND EASTERN EUROPE AND ONE OF THE BIGGEST EUROPEAN INSTITUTIONS INVESTING IN CORPORATE DEBT INSTRUMENTS. CVI began its operations in 2011 and grew to be the leader in non-bank debt financing in Poland and the region. Since 2012, CVI has closed over 700 corporate debt transactions and invested over EUR 1.6 billion in CEE. CVI has currently over EUR 1.3 billion assets under management out of which an estimated EUR 1 billion is invested in private debt in the region. The company plans to double that amount by Only in 2017, CVI has invested some EUR 620 million in CEE, fuelling 108 private debt transactions in sectors such as real estate, trade, industrial goods and business services, financial services, consumer goods as well as technology, media and telecom, just to mention a few. WHAT KIND OF INVESTMENTS DOES CVI CARRY OUT? CVI supports companies growth through financing acquisitions, operational or capital expenditure, working capital or refinancing existing debt. CVI does not have a specific industry focus. Funds managed by CVI invest from EUR 3m to EUR 20m in a single project for periods of up to five years, but there were cases when CVI has invested larger amounts. CVI s financing can be provided in EUR or USD currency. CVI INVESTMENTS IN ROMANIA In July 2017, IMPACT S.A., a real-estate developer listed on the Bucharest Stock Exchange, issued 120 Series A bearer bonds with the nominal value of EUR 12 million. The offering was subscribed in its entirety by funds managed by CVI. In November 2017, during the private placement of One United Properties, a real estate developer, funds managed by CVI have fully subscribed to bonds for a total value of EUR 20 million. In May 2018, EUR 25m corporate bonds of AAylex Group, one of the leading producers of poultry meat, known locally under CocoRico brand, were subscribed by funds managed by CVI. 1

3 CVI PROVIDES FLEXIBLE FINANCING SOLUTIONS FOR CEE-BASED CLIENTS: Small and mid-cap companies Real Estate Developers Financial Services businesses TO USE FOR ONE OF THE FOLLOWING PURPOSES: Working capital Capital expenditure/ investments Acquisitions Buyout of shareholders Refinancing of existing debt Payment of additional dividends Restructuring ADVANTAGES OF CVI CORPORATE BOND FINANCING: Retained ownership/control: Owners retain full control over our debt solutions, or at least keep a majority with our equity/structured equity solutions. Individual terms: EUR 2-25 million in tailor-made structures with flexible terms, e.g. cash vs capitalized interest, individual financial covenants, dividend payment options, holding structures. Fast execution: Increased speed of execution based on nimble credit processes and direct access to decision makers; the typical process takes 5-10 weeks. Solutions for various risk levels: Our solutions can be used for higher-risk situations than what banks are willing to finance. Based on trusted relationships: Monitoring of investment performance over its lifetime by the same team as the initial investment negotiations; any potential issues can be dealt with quickly and effectively. Local experience: Warsaw based office with team members experienced across CEE, believing that presence on the ground is necessary to succeed in investing in CEE markets. 2

4 MAIN PARAMETERS OF CVI FINANCIAL INSTRUMENTS: Debt product, usually structured as floating rate note, with coupon payable quarterly or semi-annually. Preference for floating interest rate. Collateral - tangible assets or shares of the issuer, but also guarantees. Covenants enable control over the agreed business goals and results and thus are the main source of security. Usually structured equity investments with a pre-defined exit for the fund (put / call option, drag along etc). WHAT DO WE LOOK AT WHEN MAKING INVESTMENT DECISIONS? 1. Business model drivers Your KPIs. Revenue and cost drivers. What kind of fundamental need does your product target? 2. Business SWOT/ Framework analysis Is there an opportunity? Why is this opportunity yours to take and not your competitors? How sustainable is your business? Is there competition? What are the barriers to entry? What is your specific advantage? 3. Financial analysis Profitability / Seasonality. Cost structure. Margin analysis / Working capital rotation / Balance sheet structure. Cash Flow analysis and Capex plan. Liquidity analysis. Financial metrics and rating. 3

5 INVESTMENT PROCESS - A WALKTHROUGH Initial review 1. Initial review A project leader is assigned to each project. Initial analysis based on information provided and high-level follow-up questions. Fast decision (go/no go) based on proprietary investment criteria. 2. Analysis and Company meeting Non-binding confirmation of interest from CVI Meeting with the founder and the management. Exchange of detailed information, including a business plan, via and Q&A sessions. Business assumptions verification. A deeper assessment of the project, following detailed analysis. 3. Term sheet negotiation Finalization of financial model and stress-testing. Preparation of financing structure. Site visit, if not done before. Negotiation of term sheet, including interest rate, collateral, covenants etc. Finalization of internal due diligence, preparation of investment memorandum. 4. Documentation and Closing CVI's Investment committee approval Confirmatory external due diligence conducted, if necessary. Legal advisers selected. Legal documentation negotiated and signed. Collateral established. Disbursement of funds Payment of additional dividends 5. Regular monitoring Quarterly verification of financial performance. Covenants screening. Adjustments to financial projections and ratings if necessary. Supporting the company in strategic business decisions. IT TAKES ESTIMATED 5-10 WEEKS FOR GRANTING DEBT FINANCING 4

6 DISCLAIMER Funds managed by CVI Dom Maklerski sp. z o.o. ( CVI ) are closed-end investment funds (alternative investment funds) in the meaning of Polish Act on Investment Funds (Journal of Laws of 2014, item 157 as amended), validly formed and existing in accordance with the laws of Poland, European Council Directive 2011/61/EU of 8 June 2011 and with Commission Regulation 231/2013 of 19 December CVI acts as sub-investment manager of the closed-end investment funds. Investment funds managed by CVI are formally represented by Open Finance Towarzystwo Funduszy Inwestycyjnych S.A. or by Noble Funds Towarzystwo Funduszy Inwestycyjnych S.A. respectively. This presentation is an advertising and promotion material and does not disclose all relevant information concerning the presented funds and investment process. This presentation does not constitute an offer in the meaning of the Polish Civil Code. This presentation is solely for discussion purposes and shall not be deemed as creating any obligations on CVI or investment funds represented by CVI to finance any party whatsoever. This presentation shall not be deemed as providing binding terms and conditions of any type of financing to any party. The final decision to provide financing to any party is a discretionary decision of CVI and relies on assessment by CVI of the business perspectives, creditworthiness, financials and/or due diligence examination of relevant entity willing to enter into a financing transaction. The information, opinions or financing conditions presented or contained in this presentation speak as of the date hereof and are subject to change without notice. Neither CVI nor its affiliates or advisers are under an obligation to correct, update or keep current the information contained in this presentation or to publicly announce the result of any revision to the statements made herein. This presentation is not dedicated to private or institutional investors to investment funds managed by CVI. This presentation only publishes product-related information and does not make any investment recommendations. Any investment decision regarding funds managed by CVI is affected with risk and should be made on the basis of the current statute of a given investment fund or terms of issue, which are available, along with the current financial reports to the potential investor before the investment. No fund managed by CVI guarantees achieving by an investor of a certain investment result. Investments in mezzanine debt instruments and distressed assets debt instruments involve a higher element of risk. The value of investments can fluctuate as a result of the fund s investment policy and is not guaranteed. For further details of investment risks associated with closed-end investment funds managed by CVI, please refer to the documents, available at the relevant entities representing funds. Unless otherwise stated, all opinions and views expressed in this presentation are of CVI. This presentation contains information only intended for professional advisers, intermediaries or entities potentially interested in obtaining financing from investment funds managed by CVI and is not designed for general publication. By reading the presentation slides, you agree to the following limitations and notifications and represent that you are a person who is permitted under applicable law and regulation to receive information of the kind contained in this presentation. Reference to companies or investments mentioned within this presentation should not be construed as a recommendation of CVI to buy or sell any investment instruments but is included for the purpose of illustration. This presentation may not be copied or reproduced without prior permission of CVI. Copyright by CVI. All rights reserved. 5

7 CONTACT DETAILS Rafał Lis CIO Ciprian Nicolae PRINCIPAL CVI Dom Maklerski sp. z o.o. ul. Piękna 24/26a Warsaw Poland Tel: Fax: