- Client: UK national entrepreneur and UK resident
- Challenge: Required non-recourse lending against private shares without pledging additional assets
- Loan Amount: £9.5M facility at 50% LTV
A UK-based entrepreneur approached Enness seeking to raise capital secured against a significant shareholding in a mature late-stage private company valued at approximately £20M, with an anticipated IPO expected within the next three years. The client's objective was to unlock liquidity from this concentrated equity position to fund a new business venture while retaining ownership of the shares ahead of the anticipated liquidity event.
Securing lending against private company shares presents a specialist structuring challenge, particularly where the borrower prefers not to pledge additional assets. Many lenders active in securities-backed lending focus primarily on publicly listed equities or private companies with established liquidity characteristics. In this case, the client required a lender willing to assess the underlying private company and consider a non-recourse structure without reliance on wider personal asset support.
Enness introduced a specialist lender experienced in underwriting private share-backed facilities where a future liquidity event was anticipated. A £9.5M structured facility was agreed at approximately 50% LTV, with the proposed five-year structure aligned to the anticipated timing of the future liquidity event. The facility also incorporated flexibility should an earlier share sale occur before the anticipated IPO timeline.
This case demonstrates how structured lending against private company shares can provide liquidity for entrepreneurs with concentrated equity positions ahead of potential future liquidity events. By identifying a lender able to assess the private company and proposed security structure, Enness helped the client explore access to capital for a new venture while retaining ownership of the underlying shares.
ENNESS DOES NOT GIVE ADVICE ON SECURITIES BACKED LENDING OR INVESTMENTS; AND LENDER INTRODUCTIONS ARE UNREGULATED.
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