Financial Advisory

Leveraged transactions - LBO, MBO, MBI

Finacorp Staff has participated in many projects concerning leveraged finance in the Telecom, Media and Technology industry. Leveraged finance allows raising funds for projects that would not receive traditional funding, or would require much more collateral of capital backing to be funded by external debt. Leveraged finance is one of the most important tools to fund LBO's MBO's and MBI's
LBO ( Leveraged Buy-out) is a transaction where a target company is purchased from the current owner by a new investor (another company, fund, management, other). The purchase is funded with external debt, and the creditor relies to a large extent on the ability of the target company to generate sufficient cash to service the debt burden.

MBO (Management Buy-out) is a type of LBO transaction where the management of the target company decides to buy it from the current owners. If necessary the funding comes from external providers, in a large part in a form of leveraged loan or bonds. That situation often takes place when:

MBI- Management Buy In is a type of LBO where the buyers are managers experienced in the sector, who decide to invest own funds and effort to buy the company and most likely to turn it around. The size of the transaction is often many times larger than financial capacity of the managers permits. The remaining funds come from the external capital providers in a form of participation as shareholders and in a form of external debt ( typically leveraged loans). This again is based on the assets and on the assessment of the capacity of the target company to generate cashflow necessary to service the debt.

Employeee Share Ownership Plans

Such Plans (ESOPs ) are one of many interesting tools that allow to align the interest of shareholders and employees together. The objectives of these groups are usually quite different, so a well structured ESOP plan can introduce many positive changes. A good ESOP strategy encompasses clear communication of benefits to employees, calculates the proper timeframe and pricing for entry and exit, allows employees to buy more shares if they wish to do so. The right plan also protects the company from excessive supply overhang at the end of the holding period

Project Finance advisory & arrangement
Carbon Credit Monetization
Environmental soft loan financing
Distressed Debt Management

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