- Client: UK national and UK resident
- Challenge: Releasing liquidity against private company shares without selling equity or providing additional collateral
- Loan Amount: Circa $7.5M facility
- Share Value: Circa £20M
A UK national approached Enness Global seeking to raise capital against a significant shareholding in a private company expected to pursue a public listing within the coming years. The client required liquidity to fund a new business venture while retaining ownership of the shares and maintaining exposure to any future value created through a potential liquidity event.
The transaction presented several complexities. Lending against private company shares is more specialist than borrowing against publicly listed securities, with a limited number of lenders willing to consider this type of collateral. The client also wished to avoid pledging additional assets, requiring a facility structured solely against the private shareholding. Identifying a lender able to consider the company’s profile and the proposed security structure was therefore an important part of the process.
Enness Global introduced the client to a specialist lender experienced in private share-backed lending. A circa $7.5M facility was structured over a five-year term, with pricing and lending terms reflecting the characteristics of the underlying security. The structure also incorporated provisions to accommodate a potential future liquidity event, subject to the lender’s terms and conditions.
This case demonstrates how specialist securities-backed lending solutions can provide liquidity for entrepreneurs and shareholders with substantial private company equity, allowing capital to be released without requiring an immediate sale of shares.
Securities-Backed Lending Disclaimer: Enness does not provide advice on Securities-Backed Lending or investments. Lender introductions are unregulated. Terms and availability are subject to the individual circumstances, underlying securities and lender criteria.
Important: Private company shares can be illiquid and their value can fall as well as rise. Where borrowing is secured against private company equity, changes in the value or liquidity of the underlying shares may affect the financing arrangements, including any collateral or repayment requirements, subject to the terms of the facility. Where repayment or refinancing depends on a future liquidity event, delays or changes to that event may affect the anticipated financing strategy.
Information contained in our case studies is for market and illustrative purposes only. In some cases, these may be made up of multiple cases and are for illustrative purposes only.
Some case studies are made up of enquiries that have come into the business, not all business completes, and the posting of a case study does not represent a completed piece of business.
Property values can fall as well as rise, and you may not get back the amount originally invested. Property investments can be illiquid and may take time to sell. Where borrowing is used, your property may be repossessed if you do not keep up repayments on a mortgage or other loan secured against it.
