Capital Markets – Fixed Income Operations
OBJECTIVE
Phoenix offers its clients full access to the national and international capital markets through fixed income transactions. The structured deals designed and executed by Phoenix create a banking “disintermediation” option so its clients can issue debt directly to institutional and accredited investor.
FOCUS
The main advantages include:
- Raising longer term funds and resources tailored to each client’s cash flow needs and the maturity/payback of specific projects;
- Lower cost as compared to traditional bank funding instruments and a better risk-reward ratio for both issuer and note holder;
- Less impact on debt and equity, liquidity, and leverage ratios;
- More leverage capacity as compared to ordinary bank loans, such as working capital loans, discount and overdraft accounts;
- Higher visibility to the financial and investment communities by being a player in the capital markets, and taking the first steps towards an IPO.
SCOPE
Some of the main fixed income operations structured by Phoenix include:
- CBN – Credit Banking Notes or Credit Linked Notes: Credit Banking Notes are corporate bonds that allow companies to raise funds in the capital markets using part of their receivable portfolio and other assets eligible to be pledged in guarantee.
- FIDC – Closed and End Funds Backed by Certain Receivables Portfolio: In this modality, a fund is created for a determined tenure and amount with a specific purpose to buy rights of credit (receivables) originated by an operational activity of a company or a group of companies. Ideal for companies that intend to “securitize” part of their receivable portfolios and provide a stable inflow of funds to their cash flow.
- Debentures: Most traditional underlying financing instrument that allows companies to raise funds in the capital market, applied mostly to public companies.
- Notes Backed by a Rent Agreement and Granted by Fixed Assets – Real Estate: Note repayment is backed up by a real estate lease/rent agreement and the real estate property. Ideal for companies that want to raise funds using its real estate or for “de-immobilization” purposes (built-to-suit).
- ECN – Export Credit Note: Notes created to fund exports as an alternatively to trade finance operations. This type of financing carries the same benefits as trade finance lines of credit and are ideal for Brazilian exporters who want longer term pre-shipment financing.
RESULTS
Through its capital markets team, Phoenix works in close coordination with its clients from the origination, to the structuring/modeling and final distribution of the notes. Phoenix’s Capital Markets – Fixed Income Operations area offers yet many others financing instruments and alternatives (local and international), that can also be specially designed to match its clients’ needs and demands.