Highly customized and innovative structured solutions
Reducation of risk-weighted capital, increase of liquidity, better prices and return enhancement for sellers
Optimized risk-/return characteristics for investors

Structured Solutions Advisory

Structured private equity solutions offer compelling benefits for sellers of large diversified private equity portfolios as well as to the investors and financing partners of the new vehicle.

Structured solutions finance larger private equity portfolios not only with equity of investors but also with one or more debt tranches. This offers attractive cash flow profiles to investors. Transactions can both be conducted as a private transaction with banks as debt providers or as a public securitization with ratings for the debt tranches.

Benefits for the seller: Active portfolio management, compliance with regulatory requirements, reduction of risk-weighted capital liquidity needs and of risk as well as enhancement of returns are the main reasons for a securitization. Through the possibility to rate bonds of the structure, financial institutions might be able to lower their risk-weighted capital under Solvency II and Basel II/III. In addition, the seller receives early liquidity, while still maintaining the relationship to the GPs of the underlying portfolio as well as part of the upside.

Benefits for the investors and financing partners: Depending on the expected risk-/return profile of the financing partners and the current market condition, various profiles for an optimized cash flow profile can be generated, ranging from a regular bond-like cash flow stream to a junior equity tranche with significant upside. Hence, investors can choose investments tailored to their individual risk-/ return profile.

mcp’s team members have long-standing experience in this market and would be delighted to create these structures again as an advisor and structuring agent and/or optionally participating as an investor out of its own funds.

Montana Capital Partners