Public to Private Deals

Course Overview:

For a quoted company whose shares trade in an illiquid market at a price that consistently fails to recognise its prospects, the rationale for ‘going private’ is compelling.

Private equity houses have a strong appetite and ample funds to invest in established companies with sufficiently predictable cash flows to service the debt raised to finance a ‘public-to-private’ deal.

This course will enable participants to gain a detailed understanding of the financial, legal and regulatory processes of taking a public company private.

Course Content:

Background

• Rationale for going private
• Requirements for secrecy
• Nature of negotiations between NewCo and TarCo
• Irrevocable undertakings
• Overview of an offer

 P2Ps and the Takeover Code

• Particular rules for P2Ps
• Resolution of conflicts of interest
• Rule 3 advisers
• Role of independent directors
• Disclosure of information (rules 20.1, 20.2 & 20.3)
• Incentivisation of P2P team (rule 16)
• Concert party presumptions & problems

The P2P decision

• The P2P team’s perspective
  • Estimating the offer price
  • How much should the P2P team invest?
  • What percentage equity should they get?
  • Particular risks to be considered
  • The business plan & financial model
  • Appointment of advisers
• The private equity house
  • Is the business suitable for a P2P?
• Solicitors for the P2P team & NewCo

Structuring the deal

• Pure equity, quasi equity & ratchets
• PIK, mezzanine & zeros
• Bridging finance & securitisation
• Senior debt and alphabet notes
• The ‘Certain Funds’ rule
• Financial assistance
• The three debenture approach
• Conduct during the offer (Code timetable)
• When to declare the offer unconditional

Clearing up

• Legal problems for the P2P team
• Dealing with minorities
• Squeeze out provisions
• Share exchange agreements
• Retaining a minority
• Delisting

Alternatives to a Takeover offer

• Schemes of arrangement
• P2P Lite

Delivering this course in-house for you to a number of participants could be very cost effective. Please call us on 020 7387 4484 to discuss this further.

If you have any questions about this seminar please write to us at post@redcliffetraining.co.uk.