NAV Financing in Private Equity: Increasing Liquidity, Facilitating Acquisitions, Improving Investment Returns

Description

This webinar will focus on NAV financings to private equity (PE) funds where the value of the portfolio companies comprising the investment assets of the PE fund provide support for the borrower's loan obligations. PE sponsors are increasingly taking advantage of this previously underused area of the fund financing market to help manage liquidity and support fund performance.

NAV credit facilities are often used by PE funds after the fund has matured beyond its investment period, when it has typically exhausted most of its investor capital commitments. After the investment period, funds generally cannot access borrowing availability under a subscription-backed credit facility because they do not have sufficient remaining uncalled capital commitments. With a subscription-backed credit facility unavailable, the fund may turn to a NAV credit facility to provide the liquidity necessary to manage its portfolio and investment activities.

NAV credit facilities allow sponsors to obtain the liquidity necessary to effectively manage the PE fund and maximize its performance. Fund investors can also receive a return on capital without resorting to a sale and foregoing any potential additional upside from holding the investments longer. Lenders can also benefit from the attractive structuring and pricing options that NAV credit facilities present.

Listen as our authoritative panel explains the features and mechanics of NAV credit financing. The panel will also address the advantages and disadvantages of NAV credit facilities for both lenders and borrowers.