The Cadwalader Fund Finance practice recently added two new associates, Johan de Wet and Dylan Glazier, in our Washington, D.C. and New York offices, respectively.
This week we continue our focus on NAV loans and, more specifically, a common structuring issue for NAV secondaries facilities: the “indirect pledge.” For our purposes, NAV secondaries facilities refer to loans to secondary private equity funds (i.e., funds that invest in other private equity funds, primarily by purchasing existing commitments from limited partners seeking to exit their investments). For these types of facilities, the value of the borrower’s portfolio of fund investments (“Portfolio Investments”) support its loan obligations. As discussed here in greater detail, the primary structural risk for a transaction of this type is that lenders typically will not have a direct security interest in the assets that support the borrower’s loan obligations (i.e., the Portfolio Investments themselves), instead taking an “indirect pledge.”
Recent days have offered us a couple of data points indicating that the private fund disclosure regime is under review at the SEC and that this review is a priority at the agency.
Details are out on the FFA NextGen’s upcoming webinar, “Spreading the mESsaGe – ESG’s Rise in Fund Finance.” Speakers include representatives from Bank of America, Citibank, The Carlyle Group and our own Wes Misson. The discussion will cover ESG loan features, notable recent transactions, pricing considerations, and LP approaches to investing and is set to take place on June 9 at 12:00 p.m. Eastern via Zoom.
Join Women In Fund Finance on Wednesday, June 2 to learn more about Israel’s growing private equity industry from women involved in the Israeli finance and innovation scene. The event begins at 11:00 a.m. EDT. Register here.
After much deliberation, the Fund Finance Association committee is thrilled to announce the recipients of the 2021 FFA Industry Awards.
Walkers has published a video, “WalkersGo: Cayman is King for Private Equity,” that reviews some of the key reasons that have established the Cayman Islands as a premier jurisdiction for PE funds formation.
Wells Fargo is looking to add an Associate to its Subscription Finance team, resident in New York, Charlotte or Los Angeles.
Cadwalader is looking to hire an experienced finance associate (3-4 years PQE) in its Fund Finance group in the London office.
In a prior article, we highlighted common issues contained in side letters that are concerning to Lenders. Whenever a problematic side letter provision is included, a Lender is faced with either excluding the applicable investor from the calculation of the borrowing base or developing a workaround to allow the Fund to keep its contractual arrangement with the investor in the side letter intact while also protecting the Lender’s interest.
The record SPAC IPO activity from 2020 has continued into 2021, and this white-hot market continues to set records. So far this year, 311 SPACs have raised over $100 billion in gross proceeds, surpassing 2020’s electrifying performance with 248 SPACs that raised over $83 billion in gross proceeds – a far cry from 2019 when 59 SPACs raised about $13.6 billion in gross proceeds. This week, members of Women in Fund Finance (WFF) were invited to attend a virtual event hosted by C200 titled “Unpacking the SPAC: Everything You Need to Know But Are Afraid to Ask.” This powerhouse panel featured WFF Co-Chair Dee Dee Sklar, who wears many hats, including as a board member of SPAC Kernel Group Holdings.