Time for Thoughtful Transactions
With continued macro-economic uncertainty in the UK driving low M&A volumes, the landscape for financing is inevitably experiencing a sharper focus on strategic transactions. In an environment less conducive for realisations, companies and owners are increasingly faced with the question: How can we create value? Thoughtful transactions offer opportunities for business owners to position their companies in a way that generates tangible returns, potentially offsetting the impact of higher borrowing costs. Whether considering an acquisition, entering a new market, resetting the capital structure with a new financing partner or re-balancing an asset in a portfolio, these opportunities can enable firms to position themselves for long-term growth and value creation.
Pricoa Private Capital continues to partner with business owners and fundamentally sound companies to structure and execute thoughtful financing solutions. Pricoa’s ability to provide flexible capital solutions across the credit spectrum can help firms navigate the complexities of the prevailing market conditions while simultaneously creating value.
Patient capital offers flexibility in uncertain markets. Pricoa offers several strategic options including junior capital solutions that are interest-only with no amortisation prior to maturity, as well as preferred and common equity investments. This element of ‘patience’ affords a company time to process a strategic transaction and navigate uncertain economic conditions, noting that in a high interest rate environment, the cash burden of flexible junior capital relative to senior debt is narrow. Furthermore, Pricoa’s ability to provide revolver and senior term debt alongside junior capital for a seamless, “one-stop” solution helps deliver value for our counterparties, improving speed and certainty of execution.
It’s important for firms to optimize a company’s capital structure to support both short-term and long-term business plans. Thoughtfully balancing risk (added leverage) with reward (faster growth, accomplishing other business or ownership goals) can provide greater opportunity for firms to maximise return on investment, especially in times of uncertainty.
Representative Partners
Our Approach
Pricoa Private Capital is one of the largest private debt providers globally with US$102.4 billion of investments across 15 international offices. In the UK, we have a long history of partnering with businesses and currently have more than $12 billion invested across over 120 companies and institutions in a wide range of sectors (as of 31.03.24).
Our bespoke funding capabilities include Senior Notes, where we invest across the entire credit quality spectrum, and Junior Capital including Subordinated Notes and Structured Equity. Pricoa is a buy-and-hold investor, with investments starting from £15 million to larger hold sizes in excess of £300 million.
We have a relationship-centric approach and partner with management teams by providing long-term patient capital to fulfil strategic objectives, diversify funding sources, fund growth capex or acquisitions, and facilitate shareholder transitions. Our teams are focused on regional markets and maintain direct relationships with a wide range of institutions, across FTSE 350 companies, privately-owned mid-market businesses, non-public institutions and charitable entities. To learn more about our alternatives strategies visit our mezzanine and direct lending pages.
