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Later stage financing
Capital for the financing of expansion, take overs, bridging etc. for established SMEs.
LBO (leveraged buy-out)
The purchase of a company is frequently conducted by a specially-founded vehicle (NewCo) with a borrowed capital proportion of more than 50%. The leverage refers to the fact that the return on equity is higher than the borrowed capital interest and thus, in turn, the return on the deployed capital increases. As a rule, the assets of the company that is taken over are used as collateral for the financing of the take over.
The investor which assumes the highest proportion and thus a greater risk; is usually the syndicate or consortium leader.
Asymmetric distribution of the liquidation proceeds in favour of the private equity shareholders. These receive their agio first, then the remaining profit is distributed among the shareholders.
In the event of the IPO, certain shareholders (management and private equity investors) are forbidden from selling shares for a certain period of time (in Germany usually between 6 and 18 months) after the day of the IPO.
LOI (letter of intent)
Legally non-binding declaration of intentions between the buyer and vendor which usually contains basic data such as purchase price, take-over conditions and modus, as well as financing and approval requirements for example. In the Letter of Intent, it is confirmed that both parties are interested in entering into talks and negotiations on a contract agreement.
Analysis and documentation of all the possible interested parties with a sale mandate (target companies with a purchase mandate); following the selection of the relevant buyers, a short list is drawn up together with the client.