M & A (Mergers and Acquisitions)
Welbeck has continued to advise companies it has raised capital for on their acquisition programs. It has helped IWP complete 34 acquisitions and Titan Wealth 5 acquisitions over the last 3 years.
SENIOR SECURED DEBT AND MEZZANINE FINANCE FROM ALTERNATIVE LENDERS INCLUDING CREDIT FUNDS
There are a large and ever-growing number of alternative institutional lenders and credit funds that offer an alternative to traditional bank lending. The debt structures that they offer are much more flexible than traditional lenders and their loans are usually 5-6 year non amortising bullet loans, with unitranche and committed undrawn facilities to support activities such as an acquisition program.
Convertible Loan Notes or CLNs are loans that have a right to convert into equity at a fixed price after a pre-agreed time. Until they are converted, they pay interest, and are secured against a company’s assets. Generally, CLNs are event driven in that they are used to support a step change in a company’s growth such as a major contract win or acquisition. Loans are usually for 3-5 years in duration.
LOANS WITH WARRANTS
These loans are used by many private investors and credit funds to provide companies with long term debt funding, usually with little or no amortisation. They are repayable in full on maturity, usually 5 years. In addition, the investor receives warrants to subscribe for equity in the borrower to provide further upside in addition to the interest received on the loan.
EQUITY INVESTMENT FUNDING
Equity investment takes many forms. For tax driven EIS or VCT investors they usually subscribe for ordinary shares in the company, although VCTs are able to invest in qualifying preference shares and loan notes as part of any equity investment. Other private equity investment always comprises a combination of shares and loan notes.