Analysis >> Financing
Asia deal financing: A selective market
Regional buyout activity is weak but leveraged loans are available for the right kind of target – in Japan, Korea, Australia, and beyond – and with a suitably customised structure
Start-up banking: Filling an SVB-shaped hole
Silicon Valley Bank was arguably the only institution globally to comprehensively service the unique banking needs of start-ups. In its absence, a mix of players are rising to the challenge
Fund finance: Filling Asia’s SVB void
Silicon Valley Bank’s collapse has prompted Asia-based GPs to review their relationships with lenders, for fund finance and general banking. Smaller managers may find the process challenging
2023 preview: Buyouts
Even though debt is more readily available in Asia than in the US or Europe, financing costs are up, and buyout investors are reluctant to move for assets in an uncertain and overvalued market
Asia secondaries: Layers and structures
With private market valuations yet to see a meaningful reset in Asia and heightened risk factors in China, investors are exploring ways to drive secondary deal flow by closing the bid-ask spread
Deal financing: Homegrown solutions
Private equity firms are relying more heavily on Asia-based debt investors to support leveraged buyouts amid a loan logjam in the US, highlighting the region’s innovation and durability
Australia take-privates: Going large
A combination of abundant dry powder and friendly financing conditions are encouraging global GPs to pursue ever-larger listed companies in Australia. For now, macro headwinds are no deterrent
Leveraged finance: ESG sells
Private equity firms in Asia are increasingly willing to consider sustainability-linked credit facilities, and banks are generally happy to provide them. Speed is currently delaying standardisation
India NBFCs: Agreeable aftermath
India’s non-bank financiers remain attractive investment targets as a convergence of macro and systemic shocks tests the market. Sturdy underlying drivers provide confidence as models evolve
Asia travel & hospitality: Ready to board?
The outlook for international tourism remains uncertain, but this hasn’t stopped some private equity and venture capital investors targeting travel and hospitality assets in Asia. It pays to be selective
Subscription credit: Fine lines
Increased standardization on disclosure has improved the visibility LPs have into how private equity firms are using subscription credit lines, but they must be mindful of attempts to loosen terms.
Coronavirus & capital calls: Time to draw?
With GPs and LPs placing a premium on liquidity, there is more scrutiny of capital call processes. Some managers are pushing for changes to documentation, but will investors relent?
Coronavirus & leverage: Room to maneuver?
Economic disruption caused by the coronavirus outbreak is likely to leave many private equity portfolio companies in breach of their leverage covenants. Borrowers and lenders are looking for a fix
India leveraged finance: Debt delivered
The greater availability of control deals in India is creating opportunities for leveraged lenders as they become more comfortable with the complexities of onshore-offshore capital movements
Australia leveraged finance: Best blend?
Two years ago, unitranche structures were a novelty in Australia’s leveraged finance market. Now they are an integral part of it. For borrowers and lenders, there might be no turning back
India NBFCs: Stemming the flow
India’s NBFC sector has pulled through its recent liquidity issues, but questions remain about the weaknesses that led to the crisis. Investors remain confident but must learn from the experience
Asia leveraged finance: Institutional aspirations
PE firms can obtain financing for leveraged buyouts in Asia on increasingly favorable terms, but this doesn’t necessarily point to institutionalization – or at least, not yet. For now, banks still lead the way
Venture debt: The loan rangers
Venture debt providers are confident that the asset class is set for growth in Asia, though momentum is slow in most markets. Lenders must adapt their strategies to meet local needs if they are to be successful
Growth mezzanine: Paying their dues
Growth capital situations can provide a healthy source of deals for established mezzanine investors, but high barriers to entry will pose challenges for newcomers
GP profile: Intermediate Capital Group
In recent years Intermediate Capital Group has branched out beyond traditional mezzanine to embrace deal structures that have no sponsor. It sees ample opportunities in Asia’s developed markets
Outbound M&A finance: The safer bets
China’s outbound M&A market has taken off in recent years, but many are skeptical that purchasing companies will be able to handle the financial and operational burdens they have taken on
China mezzanine: Hybrid solutions
Investors see more opportunities in the growth mezzanine space as China’s economy slows, but deal structuring is a challenge due to the need for onshore and offshore components
India NBFCs: Lending a hand
Momentum is building among India’s non-banking finance companies, and PE, government and regulators see promise in the power to reach untapped markets. Success will require the support of all three parties
Australia mezzanine: Compromise solution
The rise of holdco PIK debt has created Australia-based financing structures in which senior lenders and mezzanine providers can coexist. They also offer GPs greater flexibility at what is, for now, an acceptable price