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| Investment Structures |
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The Funds have utilized instrument structures that range across the spectrum of the capital structures of both private and public companies. It will continue to do so depending upon the circumstances of each investment. The structure of each investment is determined by the nature of the deal and the trade off between the risk and return opportunity. Where possible the Funds like to utilize convertible debt, which is held for several years before converting, and then hold the common equity in the company for several additional years before exiting.
Given the public nature of the industry, the Funds also is comfortable to participate in equity placements or on market acquisitions of common stock. The Funds related to acquisitions, both for their portfolio companies and in other mining industry transactions. The facilities can be provided for terms of 3-9 months while long term capital structures are established. Additional potential investment structures include:
Providing standby/guarantee facilities for project-related obligations or debt;
Providing subordinated or mezzanine debt; and
Supporting hedging requirements of portfolio companies.
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