Full Market Tender & New Acquisition
$24m Commercial Facilities
Service
Full Market Tender, Corporate Finance & Debt Advisory
Funding Amount
$24m
Funding Purpose
Acquisition of Poultry Farm
Industry
Agri – Poulty
The Scope
- Our client wanted a firm to undertake a full market tender of their existing $8.9m facilities and at the same time source new funding for a large new acquisition of an additional poultry farm asset to add to their portfolio.
- The client was unsure of exact debt structures and debt capacity but wanted to borrow “maximum” leverage, contribute minimal equity, and realise equity built up in existing assets.
- Directors did not want to provide personal guarantees and only shareholder guarantees were available.
What we Did
- The client had internally forecasted to contribute $3m of cash equity and an interest rate margin of 2.25% – 2.50%.
- We provided full advisory services around debt capacity and prepared an information memorandum for the market tender to achieve close to 100% debt funding for the new acquisition and create competitive tension for a more favourable interest rate outcome.
- Nexus Capital Partners conducted a two-week market tender process, arranged and negotiated the full $24m debt package, and provided a full dashboard for directors to review the outcome of the tender and our recommendations.
- We received four credit-endorsed term sheets within an average turnaround to the approval of 12 days with banks on a $24m transaction.
The Result
- Clients saved approximately $150k a year in interest ($750k over loan term) and contributed no further equity into the purchase beyond the standard deposit.
- Most importantly, clients received market-leading terms and they continued doing what they do best, which is running their businesses. They left the entire finance process and negotiations with us.
- In summary, clients moved their banking relationship to a new bank and achieved a margin above BBSY of 1.80 with no Director’s Guarantees and a five-year loan term.
