Advisory Services
Millinium Capital Managers Limited ("MCML") works with a select number of companies in for corporate advisory activities. MCML’s corporate advisory activities include specialised services in privately owned businesses and small to medium sized public and ASX listed companies, specially targeting companies which have a market capitalisation of up to $100 million or over. These activities specifically cover:
1. Debt Advisory
2. Capital Markets
3. Structured Finance
1. Debt Advisory Work
MCML provides a range of debt structuring services focused on providing advice to corporates in the energy, utilities, infrastructure, resources and industrial sectors. These core services include:
- arranging debt whereby we together with the client, determine the funding strategy through the assessment of comparable debt, preparation of an information memoranda and initial term sheet, management of debt providers, due diligence and selection and appointment of debt providers.
- debt negotiations whereby we assist with advice and negotiation with terms and structuring.
2. Capital Debt Markets
A related entity of Millinium through through its relationship with Greenhouse Investments Limited in the (UK) (see Alliance Partners details)is able to gain access to the following Greenhouse products for certain investors and issuers. These structured products include:
Structured Credit Trading
- A fully tradable instrument that can be cleared through Euroclear or Clearstream
- Quoted on Bloomberg and is fully transferrable without impacting the underlying investment
- Structured using ‘bond-like’ terms and convertible into the equity of the underlying investment
- Has a coupon stream, redemption premium and pre-determined equity linked upside
- Disclosure of instrument ownership is entirely the investors option
Convertible Bond
- Bespoke private placement approach direct interaction between issuer and investor
- Instrument terms and pricing are supported with due diligence and investor presentations
- Although not a pre-requisite, instrument can be rated and exchange quoted
- Instrument suits smaller issuers without a high credit rating
These Greenhouse products are supported with our ongoing involvement to manage the integrity of the transaction documentation:
- Capital is applied in accordance with agreed use of proceeds
- Monthly management reports are submitted to investors detailing key performance metrics
- One of our director’s may take on role as board observer
Alternative approach to conventional bonds
Overall structure is aimed at equipping the provider of capital/investor with options on they manage their investment. The key investor benefits can be summarised as:
- Provides investor anonymity for long as may be required
- Access to a fully tradable instrument that can be wholly sold or partially syndicated through Euroclear without affecting underlying asset or having to notify the issuer
- The instrument pricing is quoted on Bloomberg
- Is income producing with normal commercial covenants and security to effect remedial action should there be a default under the transaction documents
- Can be structured as a convertible instrument
The structured credit solution essentially has two parts:
Bespoke capital markets solutions
- Essentially this offers a bespoke debt capital solution that allows its clients to optimise their balance sheets through a private placement transaction. These bonds are sold to a number of institutional ‘buy and hold’ investors (e.g. pension funds, insurance companies, fixed income hedge funds etc ) in the UK, Europe and Asia
- Private placement is a form of bond issuance with maturities ranging from five to fourty years. Whilst private placements do not generally require a public credit rating, Millinium has the capability to determine credit risk
- Private placements allow issuers to be discrete in their funding operations and ideally suit issuers that do not have a high credit rating (despite being a large business in some cases) making such issuers less attractive to the ’bulge bracket’
- Investors can also invest without unnecessary publicity.
Our added value
- Documentation – This offer achieves flexibility in terms and conditions and approaches investors accustomed to treating offering information in confidence
- Structural Expertise – we are experienced in working with complicated holding companies, special purpose vehicles, private companies and foreign based issuers
- Quick Execution – Millinium and Greenhouse has the ability to enter the market quickly, completing the entire process in ten to eighteen weeks for a typical first time issuer. Well known names and repeat issuers would be less
- Maximum Value to Client – expenses incurred in connection with private placement of debt securities are generally lower than those associated with a public offering. The private market can therefore be more economical for smaller issues on an ‘all-in’ basis than other debt alternatives
- In-house Capabilities – Millinium manages syndication, credit analysis/scoring, transaction documentation, transaction management, post-closing oversight and investment management (board observer, reporting, application of proceeds etc) for instrument life.
Pricing and engagement process
Pricing in both instances will be reasonably consistent:
- 100% Convertible with conversion and pricing parameters set for both optional and forced conversion scenarios
- Coupon spread will be 7.0% to 12.5% depending on the actual credit risk
- Redemption premium will be from 130%
- Instrument will rank senior and secured
- Cash management/control embedded into documents to help with remedial action
- Engagement with a Millinium company with our group
- Defined arrangement and success fee
- Break fee if issuance is cancelled by either issuer or investor
Reasonable out-of-pocket expenses recovered
3. Structured Finance
Millinium Asset Management Pty Limited sources loans for various commercial purposes including the acquisition, refinancing or development of property through different strategic alliance partners. Other lending opportunities can also be arranged and facilitated to approved applicants. We aim to give access to quick and efficient bank finance. Our services are suitable for a range of projects, direct developments, companies as well as listed and unlisted vehicles. We can provide a mixture of senior and mezzanine funding to cover the needs of the borrower. Every application is individually assessed and, subject to lending criteria, we endeavour to customise the offer to suit individual requirements. Our general terms are out below:
Amount of Loan |
Minimum $2,000,000 up to $100,000,000. Applications over $100,000,000 may be considered. |
Terms |
2 years to 20 years. |
Purpose |
Acquisition, refinancing or development activities. |
Interest Payments |
Interest only, Principal and Interest, Prepaid interest and in some cases Capitalised interest. |
Millinium Asset Management Limited also assists with:
- structuring and arranging new debt for development projects, acquisitions, privatisations and existing corporate activities;
- refinancing and restructuring existing debt to improve efficiency (both as to cost and flexibility); and
- restructuring existing debt arrangements of stressed or distressed assets.