PMV corporate loans

SMEs and large enterprises which have

• an operational office in Flanders and/or added value for Flanders
• a track record in generating positive cash flow
• a solid market position
• a well-balanced management team
• a solid business plan that demonstrates sufficient capacity to repay current and future debts

Our financing solutions are designed to finance your tangible, intangible and financial investments, as well as your need for working capital associated with the development of your business.

PMV also finances the acquisition of the shares of an existing company or the acquisition of (part of) a business fund. Such a takeover can be part of a family succession, a management buy-out (MBO) or a management buy-in (MBI). PMV stimulates dynamic and competent managers in their entrepreneurship by supporting them financially in the acquisition of companies. They often give a new boost to the company and are able to make the necessary strategic choices that are needed to allow the company to grow further or to survive in changed market conditions.

Do you wish to refinance existing debts over a longer period of time in order to maintain sufficient operating resources to safeguard continuity and/or growth? Then some of our financing solutions may also be interesting to you.

Our financing solutions differ from traditional (bank) financing by:

• a longer duration. The loans have an average term of 7 years and a maximum term of 10 years
• a high degree of flexibility, which is reflected in, for example:
  • the possibility of drawing down the loan in one or more tranches
  • the deferral of capital repayments for at least the first two years of the loan, with the possibility of repaying the entire principal on the maturity date
  • a remuneration adapted to the risk profile of the loan, determined by the repayment capacity and the possibility of providing collateral
  • the possibility of early repayment of the loan

Other conditions:

• Minimum amount of EUR 700,000
• Market-based remuneration with 3 possible components
  (a part) cash interest
  ( partly) deferred interest, payable at the final maturity of the loan
  a part variable remuneration, in function of the performance of the company
• At least 50% of the company’s overall financing requirement is always covered by banks, shareholders, managers, financial investors, etc.
• Little or no collateral
• Covenants: provisions with which the borrower must comply, such as providing financial information or meeting financial ratios.

Senior loans rank equally with bank or other financiers who have a position with certain privileges based on specific collateral and/or a negative pledge. Often agreements are made among the senior creditors as a result of which, in the event of the failure of the borrower, all the creditors of equal rank are treated equally.

Senior loans are provided to companies with a conservative debt structure: a debt ratio (net senior debt) of maximum 3.5x Ebitda. These loans are truly tailor-made solutions that offer maximum flexibility for companies to optimise their debt structure according to their needs. In addition, a long deferral of capital repayments can be granted, as a result of which a senior business loan from PMV has a higher risk than traditional (bank) financing and lowers the overall risk profile of your business for the bank.

Depending on the type of senior business loan that we can offer you, additional criteria or benefits may apply. Our investment managers will be happy to explain these to you in a personal meeting.

Subordinated loans, also called mezzanine financing, rank after bank or other financing. This means that in the event of the borrower failing, the subordinated loan can only be repaid after the bank or other senior financing has been fully repaid.

This type of loans is often used when a company or a group will have a temporarily increased debt ratio because of certain expansion plans, planned acquisitions, etc. In the company’s business plan, the debt ratio falls rapidly because of increasing revenues after implementation of the plans. In this scenario, traditional financiers do not wish or are unable to take on these risks in the initial phase, thus creating a financing gap that shareholders in turn cannot or do not wish to fill entirely with capital.

Our subordinated business loans offer a good solution to this problem because they combine elements of a loan with those of a capital contribution. Thus, we provide permanent medium-term financial resources that strengthen the company’s equity and solvency. Due to the subordinated character, these loans carry a higher risk and therefore also a higher remuneration. However, the loans do not dilute the existing shareholders, or only to a limited extent.

Depending on the type of subordinated business loan that we can offer you, additional criteria or benefits may apply. Our investment managers will be happy to explain these in a personal meeting.