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Mezzanine Finance

Structured finance to facilitate future growth

Finance that won't dilute shareholders equity

Mezzanine finance is a hybrid debt instrument that sits between equity and senior debt in the company’s capital structure. Mezzanine finance is used to bridge the risk-reward gap in highly leveraged transactions without diluting shareholders equity.

Our structured approach enables us to provide a facility that does not place a strain on operating cashflow and offers flexibility for future growth. Transactions are typically structured using a combination of:

Capitalised, part-capitalised or fully paid interest
Scheduled or bullet repayments
Warrants or redemption premia

When used as an alternative to equity, mezzanine finance lowers the overall cost of capital on a deal, thus enabling shareholders to enhance their equity returns.

Mezzanine finance and preferred equity case studies

>	Telinet	Follow-on acquisition
	Telecommunications	Following our initial investment in Telinet in August 2006 we further funded the acquisition of two technology service companies, Newburn Consulting and Evolution Voice & Data plc.
>	Aerial	Mezzanine lending
	Wireless coverage solutions	We provided mezzanine finance and an element of senior debt finance as part of the acquisition of Avitec by Aerial Facilities Ltd.
>	Clinisys	MBO
	Diagnostics software	We provided mezzanine finance to assist with the management buy-out of CliniSys from the founding shareholders.
>	Catalyst Media Group	Refinance
	Media	We provided a loan to refinance existing deep discounted bonds, enabling Catalyst Media Group plc to increase its effective stake in Satellite Information Services (Holdings) Ltd.
>	Superglass	MBO
	Insulation	We worked along side NBGI Private Equity to provide mezzanine finance and preferred equity, which gave the company an attractive alternative to syndication and allowed them to enhance further their equity returns.
>	Spectrum Interactive	Secondary MBO
	Telecommunications	We provided mezzanine finance to support ongoing organic growth of the business and as part of a secondary management buy-out.
>	Iris	Refinance
	Software	We participated in the higher yielding mezzanine, second lien and senior loan notes as part of a syndicated refinance.
>	DVC Sales	IBO
	Marketing services	We worked to develop a post-transaction mezzanine finance structure as an alternative to a full syndication of part of the institutional equity.
>	Euphony	MBI
	Telecommunications	We provided acquisition finance to assist Giles Redpath with a management buy-in to Euphony, a network marketing based telecoms company.