Client: European family office holding a concentrated position in listed German industrial equities
Deal Value: €35,000,000
The Challenge
A prominent European family office held a highly concentrated position in a single listed German industrial company representing the majority of their liquid net worth. They required significant liquidity to fund a time sensitive acquisition opportunity but were unwilling to sell their equity position due to the substantial capital gains tax liability that would be triggered and their long term conviction in the stock. Traditional private banks refused to lend against a single concentrated position of this size.
The Solution
We structured a securities backed lending facility against the concentrated equity position with a specialist international lender experienced in large single stock exposures. By presenting a comprehensive risk analysis including stock volatility metrics, average daily trading volumes and a detailed borrower financial profile we secured a facility at a competitive loan to value ratio. The entire structure was arranged discreetly through the family office's existing legal framework.
The Outcome
The family office accessed €35,000,000 in liquidity within 15 working days without disposing of a single share. The acquisition was completed on schedule and the stock loan was subsequently repaid in full from the proceeds of the acquired business within 18 months.
They understood our position perfectly. We retained our equity, avoided a substantial tax event and completed our acquisition on time.
— Client — European Family Office, Frankfurt