ALCORs Growth Solutions for Business Helps Corporate Companies in the Areas of Investment Banking, M&A, Private Equity and Corporate Finance.
ALCOR provides a one-stop solution in Investment Banking with world-class corporations and companies as its clientele. ALCOR expertise spans the spectrum of finance - Mergers & Acquisitions, Equity Financing, Debt Financing, ECB, Financial restructuring, and investment banking advisory. ALCOR has footprints across the globe and an extensive presence in India with over 48 regional offices. ALCOR serves a wide cross section of verticals, some of which are the following: Automotive, Power, Telecom, Electronics, Software, Real Estate, and Education.
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True to its global stature as a leader, ALCOR's business philosophy is driven by highest levels of integrity and honesty at the heart of business. ALCOR obeys and complies with the rules of the land . ALCOR’s erudite Directors are from Harvard, Oxford and other prestigious institutions. The execution Team comprises of internationally reputed and highly experienced finance personnel.
ALCOR leverages its strong global footprint and the value of its international board of advisors to provide its clients with high growth transactions across the globe. We use our international deal-making experience to deliver customized advice to clients on each transaction. We assist clients in evaluating international and domestic Acquisitions and Joint Ventures. Global Fortune 500 companies work with ALCOR to assess suitable targets across the globe for market entry or market share expansion. ALCOR solutions include Mergers & Acquisitions, sell side, & buy side advisory, leveraged buyouts & other types of corporate restructuring. Standing aloft with over a 100 man-years in cross-border M&A advisory & independent research & experience, ALCOR, delivers maximum value from their transactions. ALCOR understands the clients' unique business needs, keeping their objectives a top priority. We work with our clients closely, often over five years, to help the client realize the value of their value creation strategy. ALCOR's wide range of product offerings are tailor made to suit client growth requirements
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ALCOR worldwide team allows for targeted search, scenario mapping, synergy realization, and detailed road map with experience-driven cross-border M&A advisory that can be customized with minority buy-in, acquisitions, or even a 50:50 joint venture.
ALCOR uses strategic tools such as the Balanced Scorecard with tailored precision to define the following -
- Core defense
- Global customer revenue model
- Strategic high growth market entry.
- 360-degree growth model
- Intangible value proposition .Core foundation pillars
- Evolved value chain integration .Low cost global value partnerships and several other strategies.
About ALCOR Mergers and Acquisitions
Alcor M&A is a leading advisory firm providing financial services with an emphasis on customized solutions in the areas of M&A advisory, Joint Venture Advisory, Financial Advisory, Private Equity, Debt Financing and International Business Development. These services leverages insights, relationships and a culture that emphasizes a strong orientation towards excellence.
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MEZZANINE FINANCING OPTIONS
Mezzanine financing has created opportunities for investors to secure cheaper alternatives to fund companies. The purpose of the article is to present an overview of mezzanine financing and discuss the various features of the debt. Included in the article is a discussion of the benefits associated with mezzanine financing as well as the risk and implications of incorporating mezzanine financing in a company’s capital structure.
CHARACTERISTICS
Mezzanine financing, also referred to as quasi-equity, comprises of both unsecured debt or second lien debt and has debt and equity characteristics. Mezzanine financing is a type of loan that is subordinated to the senior debt in a firm’s capital structure but is above the common stock or preferred equity. This form of debt can take the form of senior subordinated debt, convertible preferred debentures or as preferred equity. Such loans are frequently used for financing acquisitions or fuelling the fire with needed non-dilutive growth capital. Within a capital structure, it is junior to all debt. Mezzanine debt has a higher interest rate since the risk exposure is more than that of senior debt.
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The yields of mezzanine financing are the highest in the bond market and are riskier compared to senior debt. Mezzanine debt financing is usually based on covenant packages such as bank facility covenants or high-yield style covenants. The bank facility covenant often has maintenance covenants and is mostly based on the credit facility’s covenants. High yield covenants on the other hand, can shield a bondholder from unfavourable actions by equity owners and safeguard a bond’s priority of claims.
Mezzanine debt that is similar to high yield debt has components such as optional redemption and call protection provisions that are comparable to high-yield notes. Similarly, mezzanine debt that includes some components of senior debt has mandatory prepayments secured to debt and optional prepayments at par, at low or decreasing premiums. For example, some mezzanine notes can be redeemed at 105% of their principal amount in the first year following the note issuance, 104% in the second year, 103% in the third year and 102% in the fourth year.
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BENEFITS OF Mezzanine financing
- Mezzanine financing is valuable in the capital structure of a company. For example, the equity capital of a company is strengthened with mezzanine financing since equity holdings are not diluted.
- Mezzanine financing also enhances the structure and creditworthiness of a company and has a positive impact on a company’s rating.
- Like equity financing, mezzanine financing does not need collateral, thereby, companies have the flexibility to use capital to expand and to manage the operations of the company.
- The use of mezzanine debt reduces the amount of equity invested in a company and lowers the after-tax cost of capital. Additionally, the value of stocks held by current shareholders increases when mezzanine financing is integrated in the company’s capital structure.
- In general, companies that use mezzanine financing have the flexibility to structure covenants, amortization and coupons to adjust and cover exclusive cash flow requirements.
- Mezzanine investors benefit from mezzanine financingas it generates higher rates of return. Investors also obtain steady returns from mezzanine funding due to contractual agreements to make interest payments.
About ALCOR Mergers and Acquisitions
Alcor M&A is a leading advisory firm providing financial services with an emphasis on customized solutions in the areas of Investment Banking, Corporate Financing, M&A advisory, Joint Venture Advisory, Private Equity, Debt Financing and International Business Development. These Services leverages insights, relationships and a culture that emphasizes a strong orientation towards excellence.
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Benefits of Debt Financing
Access to capital is one among the most important barriers little businesses face once wanting to implement growth ways. That’s why it’s vital to know each the benefits and downsides of debt finance. A convincing truth in business is that it takes cash to create cash; however, it takes inexpensive cash to last. However, wherever can that cash come back from? There square measure scores of choices. Don’t let the word “debt” scare you. Primarily, debt finance is that the act of raising capital by borrowing cash from a loaner or a bank. Reciprocally for a loan, creditors are then owed interest on the cash borrowed. Debt may be cost-efficient, providing little businesses with the funds to top off on inventory, rent further workers, and buy property or much-needed instrumentation.
Advantages of Debt Financing
You Won’t Give Up Business Ownership
To begin with, one major advantage of debt finance is that you just won’t be dropping possession of the business. Once you get rid of a loan from a financial organization or various loaners, you’re duty-bound to create the payments on time for the lifetime of the loan, that’s it. In distinction, if you hand over equity within the style of stock in exchange for funding, you may end up sad regarding input from outside parties relating to the long run of your business.
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There are Tax Deductions
A strong advantage of debt finance is that the tax deductions. Classified as a disbursal, the principal, and interest payment thereon debt is also subtracted from your business financial gain taxes. Professional tip: invariably refer to a tax skilled or different monetary planner to assist answer specific questions about however debt affects your taxes.
Low-Interest Rates are Available
Credit cards, peer-to-peer disposition, short-run loans, and different debt finance isn’t useful if the interest rates square measure enthusiastically. However, there's excellent news. A little Business Administration (SBA) loan may be a nice choice for inexpensive funds. With long terms and low rates, associate independent agency loan is that the gold customary for inexpensive finance. If you don’t qualify for associate independent agency loan, there square measure many different choices out there. Simply be conscious of verity price of that loan. Work with a loaner WHO practices complete transparency thus you doesn’t get at bay in a very cycle of borrowing. Perceive your total payment, each interest, and amortization. a decent rule of thumb is that if you sometimes have quite one payment per month or if the payment calculation is too difficult, mind and beware to not move forward.
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You’ll Establish and Build Business Credit
The Global Entrepreneurship Monitor report, made by Babson school and different universities, found that one among the highest reasons for discontinuing a business within the U.S. were issues getting finance. Stellar business credit is crucial if you’re seeking inexpensive, semi-permanent debt funding. Therefore, having the flexibility to make your business credit may be a major and crucial advantage to confiscating a loan. Once you build your little business’ credit, you scale back the requirement to accept your personal credit or different high-cost business finance choices. Sensible business credit may also assist you to establish a lot of favorable terms with vendors.
Debt Financing Can Save A Small Business Big Money
Often, little business house owners accept pricy debt – like credit cards, money advances or lines of credit – to induce their business off the bottom. This kind of debt cuts into income and may hinder everyday operations. A giant advantage of debt finance is that the ability to pay off high-cost debt, reducing monthly payments by a whole lot or maybe thousands of bucks. Reducing your price of capital boosts business income.
Long-term Debt Can Eliminate Reliance on Expensive Debt
There are lenders who are using aggressive sales techniques to induce businesses to require out short-run money advances. Some businesses in would like of funds can intermit or six money advances in a very row. This strategy will lure a recipient into a debt cycle with without stopping in a website. Instead, look to induce associate independent agency loan. Independent agency loans have low-interest rates, long terms, and low monthly payments. Independent agency loans may be accustomed facilitate free little business house owners from borrowing traps.
About ALCOR Mergers and Acquisitions
Alcor M&A is a leading advisory firm providing financial services with an emphasis on customized solutions in the areas of M&A advisory, Joint Venture Advisory, Financial Advisory, Private Equity, Debt Financing and International Business Development. These Services leverages insights, relationships and a culture that emphasizes a strong orientation towards excellence.
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Venture Capital Deals Break More Records in Q3 2017
Quarter builds on $48bn in deals announced in Q2 to register an all-time high of $49bn
The venture capital-backed deal industry has registered a second consecutive record-breaking quarter, as 2,362 deals were announced worth a combined $49bn. Expecting these figures to rise by around 5% as more information become available. This follows Q2, which saw 2,512 deals announced worth $48bn, to put total deal activity in the first three quarters of 2017 at $128bn, on course to become an all-time annual high. However, these record values are being recorded by a declining number of transactions, with Q3 representing the sixth consecutive quarterly decline.Q1-Q3 2017 has seen 7,552 venture capital-backed deals announced, compared to 8,792 in the equivalent period of last year.
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Key Venture Capital Deals Facts:
- In Q3 2017, there were 2,362 deals made with an aggregate deal value of $49bn. This is the second consecutive quarter to register record high aggregate deal values.
- North America saw the greatest activity in the quarter, with 939 deals announced for an aggregate deal value of $19bn.
- Israel saw the greatest drop in deal activity from the previous quarter. In Q2 2017, Israel made up 34% of aggregate deal value; in Q3, this figure stands at just 1%.
- Series A financings made up 31% of venture capital deals in Q3 2017, while angel investments accounted for a further 26% of deal flow.
- Later stage venture capital deals have increased in value over the past few years. While average series A-C financings in 2017 YTD are smaller than in 2016, Series D and later funding rounds have hit a new record high of $98mn.
- Deals in software account for the greatest proportion of deals (26%), but deals in internet companies account for the largest share of aggregate deal value (26%).
- The largest venture capital deal announced in Q3 was the $2bn financing of Grab Holdings.Funding came from investors including Didi Chuxing, the firm involved in the largest venture capital-backed deal ever recorded.
- The largest venture capital-backed exit announced in Q3 2017 was the CNY 9.5bn sale of China-based Mango TV to Happigo.
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2017 now seems assured to set new records for venture capital-backed deal activity, as the industry has witnessed its second consecutive record-breaking quarter. Driven by the rising number of late-stage multi-billion dollar financings – eight in Q3 alone – the industry is setting new records with increasing regularity. Increased opportunities in emerging markets and increased appetite from investors are combining to propel the venture capital industry to new heights.
The bulk of deal activity remains focused on the earlier part of the funding cycle, with angel and series A investments accounting for almost half of total deal numbers. However, deal values are increasingly being driven by large late stage financings and debt issuances. In fact, while the average value of financings up to series C have all fallen in 2017, average series D deals are at a record high, while the average venture debt issuance is more than twice as large as it was in 2015.
Source - preqin
About ALCOR Mergers and Acquisitions
Alcor M&A is a leading advisory firm providing financial services with an emphasis on customized solutions in the areas of M&A advisory, Joint Venture Advisory, Financial Advisory, Private Equity, Debt Financing and International Business Development. These services leverages insights, relationships and a culture that emphasizes a strong orientation towards excellence.
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Paytm Acquires Nearbuy and Little, to Merge both - Expect A Busy 2018 On The M & A Front
Paytm on Wednesday announced the acquisition of Nearbuy and Little, two deals platforms that focus on local restaurants as well as commercial establishments. In a statement, Paytm said it arranged a merger of the two well-funded start-ups and made a “strategic” investment in the resultant entity for a majority stake. Sequoia Capital India, a large investor in Nearbuy (formerly Groupon India), continues to be a shareholder in the merged entity. Paytm did not say whether Sequoia sold a part of its investment in Nearbuy to Paytm Nearbuy, which was founded as SoSasta, was acquired by NASDAQ-listed Groupon Inc. in 2011.The company was later renamed as Groupon India, in 2013.In 2015, Sequoia Capital India and the current chief executive officer (CEO) Ankur Warikoo bought a majority stake from the US-based parent of the firm and named it Nearbuy.Little app (Little Internet Pvt. Ltd), on the other hand, was launched in 2015 with initial backing from Paytm, which wanted to test the waters in the hyperlocal deals business.The app started with a $50 million investment from Paytm, SAIF Partners and Tiger Global Management (SAIF is also a large minority shareholder in Paytm).
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After a somewhat choppy 2017, many experts are calling for a busy 2018 in the M&A space. The Predictions and Reports suggests that the pace of M&A activity will increase in 2018, based in large part on “a combination of gradual acceleration in global economic growth, low inflation in advanced and emerging economies, buoyant asset markets and low-interest rates that continue to bolster the M&A markets.” While there are concerns that could impact the potential increase in deal flow (such as a rise in economic protectionism or a global equity sell-off) the prevailing view is that the positive conditions for M&A activity will continue to rule the day and drive increasing deal making.
One of M and A Experts says “The State of the Deal-M&A Trends 2018” report takes a similar view. The report, based on a survey of business executives, notes that a significant majority of respondents expect M&A deal flow to increase over the next 12 months, while deal size is expected to increase as well. The report cites acquiring technology, expanding customer base in existing markets and expanding/diversifying products and services as the leading drivers for M&A deals. Among other positive factors, the report notes that cash reserves are up significantly at potential acquirers, and that the primary intended use of that cash is for acquisitions.
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Family-owned businesses should see an uptick in M&A interest as we move into 2018.
Buyers are always on the watch for well-run businesses with quality earnings and customer bases. Family-owned businesses that are looking to grow should see an opportunity to acquire other businesses. Those businesses that want to take advantage of a favourable market should start to take steps now to prepare, by working with management and advisors to get the business “in shape” for a transaction. Several upcoming posts on this blog will discuss specific items that come up in almost every deal and steps business owners can take to prepare for a sale, such as dealing with financial statements, contracts management and HR/ERISA issues.
About ALCOR Mergers and Acquisitions
Alcor M&A is a leading advisory firm providing financial services with an emphasis on customized solutions in the areas of M&A advisory, Joint Venture Advisory, Financial Advisory, Private Equity, Debt Financing and International Business Development. These services leverages insights, relationships and a culture that emphasizes a strong orientation towards excellence.
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Fundraising for Women-Run Venture Capital Funds Accelerates
Despite remaining underrepresented in the industry, women-owned funds are securing more capital and making more deals in 2017
Women make up an average of 21% of staff at venture capital funds. This proportion falls to 11% of senior staff, and just 6% of board members at venture capital firms. However, women-owned* venture capital vehicles have seen fundraising reach new heights in 2017 YTD, as 13 funds have secured $2.4bn as of September. This is up from the $1.8bn raised by 25 women-owned funds in all of 2016, and follows a consistent trend of growing activity over the past five years. Looking ahead, there are 58 further women-owned funds in market, seeking a combined $6bn from
investors – 4% of total capital sought by the industry. Women-owned funds are also increasingly active deal makers, being involved with 510 financings in 2017 so far, worth a total of $6.4bn. The largest proportions of these were in software and internet companies, mirroring overall industry trends.
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Key Women in Venture Capital Facts:
- Women make up an average of 21% of venture capital employees. At a senior level, women constitute 11% of staff, and occupy 6% of venture capital board seats.
- Women-owned venture capital funds have seen a sustained upswing in annual fundraising. Twelve women-owned funds raised $0.8bn in 2013. As of October 2017, though, 13 women-owned vehicles have secured $2.4bn.
- There are 58 women-owned venture capital funds in market, seeking a combined $6bn. The largest of these is Baidu Capital, which is targeting $2.95bn.
- In the first three quarters of 2017, women-owned funds have been involved with 510 deals, worth a total of $6.4bn. Of these, 25% were for software companies, and 22% were for internet firms.
- On a partner level, female partners have led 307 deals in 2017 so far, worth a combined $5.1bn. This is a record for both the number and value of women-led deals, and accounts for 9% of total deal activity this year.
- Funds of funds are the most active investors in women-owned funds, providing 29% of funding since 2000. Public pension funds (22%) and foundations (13%) are also significant backers.
- Almost three-quarters (74%) of funding for women-owned venture capital funds comes from North America-based investors. European and Asian investors account for 20% and 5% of commitments, respectively
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The venture capital industry is undergoing a storm of controversy over the representation and treatment of women both as founders and as venture capitalists. Initiatives to promote gender equality in the industry have included high profile decency pledges and women-focused mentorship and empowerment programs. Women only represent one in five staff at venture capital firms, and one in ten senior staff, highlighting the uncommon nature of these programs, and the structural and long-term challenges they face. However, we may feel encouraged by the fact that women-owned venture capital funds have steadily become more common and more active, raising more money in the first three quarters of 2017 than ever before as well as being involved in over 500 financing rounds. At the same time, female partners at firms have already marked a record year for both the number of deals they have led, and the total size of those deals. While these developments are welcome,
it should not dilute the fact that women undoubtedly still face numerous challenges in the venture capital industry.”
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Alcor M&A is a leading advisory firm providing financial services with an emphasis on customized solutions in the areas of M&A advisory, Joint Venture Advisory, Financial Advisory, Private Equity, Debt Financing and International Business Development. These services leverages insights, relationships and a culture that emphasizes a strong orientation towards excellence.
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North America Sees Infrastructure Fundraising Soar
Renewed focus on infrastructure projects in North America has benefited the unlisted infrastructure market in the region. Over the past decade, North America-focused funds have raised an aggregate $178bn, far ahead of $119bnraised in the same period for Europe, the next largest market. Although North America-focused unlisted infrastructure fundraising experienced a gradual decline from 2013 to 2015, the region represents the largest infrastructure fundraising market in the world. 2016 was a record year for the region, with 23 funds securing $33bn in capital commitments, including the largest infrastructure fund ever closed. So far, it seems as though 2017 is on the path to continue last year’s fundraising momentum, with 12 funds having secured $20bn as of August.
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Key North America Infrastructure Facts:
- North America represents the largest infrastructure fundraising market, having raised an aggregate $178bnin the last 10 years.
- North America is home to the seven largest firms by total capital raised for unlisted funds in the past 10 years.
- Additionally, nine out of the 10 largest unlisted funds ever closed are primarily targeting North America and account for 19% of all unlisted infrastructure capital secured.
- 2016 was a record year with 23 funds securing $33bn. 2017 is on track to match last year’s fundraising record with 12 funds closed, securing an aggregate $20bn.
- North America-focused funds have become more successful in their fundraising year-on-year. In 2015, 42% of funds exceeded their target size; this has risen to 75% of funds closed in 2017 YTD.
- In fact, half of funds closed so far this year have raised 125% or more of their target size, the largest proportion tracked.
- Currently, there are 47 North America-focused unlisted infrastructure funds in market with a combined target of $79bn in capital commitments. This includes Blackstone Infrastructure I which, with its $40bn target size, is seeking to be the largest ever infrastructure fund.
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North America has traditionally represented the largest part of the unlisted infrastructure fundraising market, but activity has reached new heights in the past 18 months. The 2016 US presidential election prompted a renewed focus on infrastructure in the country, and fund managers have moved to take advantage of the perceived opportunity this represents.
Looking ahead, there are several multi-billion dollar funds currently seeking capital to deploy into projects in North America, including Blackstone Infrastructure I, which is seeking to be the largest ever infrastructure fund. With the deal making environment in North America showing long-term growth, and vying with Europe to become the most active region for infrastructure investments, the prospects for managers to deploy capital in the coming months are promising.”
About ALCOR Mergers and Acquisitions
Alcor M&A is a leading advisory firm providing financial services with an emphasis on customized solutions in the areas of M&A advisory, Joint Venture Advisory,
Financial Advisory, Private Equity, Debt Financing and International Business Development. These services leverages insights, relationships and a culture that emphasizes a strong orientation towards excellence.
For additional information on how ALCOR MNA can help you Grow your Company, Complete the Enquiry form One of our representatives will contact you within one business day.
