Life cycle of a project/investment

 

1. set up (structuring)

2. growth (financing/loans/leasing)

3. optimization (restructuring/risk management/insurance)

4. cost saving (effectivity/cost cutting)

5. investment (portfolio management)

Investment fund

 

Investment Fund Vehicle (IFV)

 

Ownership structure

• 50% - Financial Investor (FI)
• 50% - Investment Committee (IC)
• 100% of shareholders’ rights necessary for change of the Articles of Association
• If any partner would like to exit the IFV then the other partner will have the right of first refusal to buy the exiting partner’s shares

 

Signatories

• Total number of signatories – 2 (FI  -  1, IC – 1)
• Acting – 2 signatories can act on behalf of the IFV only jointly

 

Bank account & accounting & running costs for FI representative

• Authorization of payments – same as acting on behalf of the IFV
• Fees and costs – cost for FI
• Revenue in the form of interest on account balance or basic bank deposit – income for FI

 

Funding

• Form - shareholder’s loan, capital investment or equity provided by the FI
• Cost of funds – no
• Currency – EUR

 

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Investment principles

 

Type of investments

• Financial investments
• Project investments

 

Life cycle of investments

• Preparation – IC
• Approval – FI
• Ownership management – IC (management fee 2% p.a. from total investment notional until exit)
• Exit strategy/decision – IC+FI

 

Cost of funds

• TBA/2% p.a. or inflation rate of the EMU (CPI of the country of investment…)

 

Currency

• EUR

 

Profit sharing

• Profit=total income (positive cash flow) minus cost of funds minus management fee
• Individual treatment of each investment with SPV (special purpose vehicle) for new project investment
• FI – 80% (investment notional repayment), IC – 20% (success fee) – until full repayment of the investment notional (if cost of funds will be 2% p.a. then no success fee for IC)
• FI - 50%, IC - 50% - after full repayment of the investment notional

 

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Financial investments

 

Type

• Sophisticated bank products, investment funds…
• Loans (also to subjects of own project investments as alternative to bank financing)

 

Risk

• Credit risk on the investment subject/provider plus
• Financial market risk in case of a financial investment linked to financial markets or
• Business risk of the subject in case of a loan (no equity risk)

 

Form

• In the name and for the account of the IFV

 

Conditions

• Conditions agreed with the provider of the investment or
• Similar to bank financing in case of a loan (interest to cover the cost of funds at least)

 

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Project investments

 

Type

• Equity investment – direct project financing with equity risk at a fixed yield guaranteed by pledged shares (initially 100% then proportional amortization in line with equity repayment) until full repayment of the notional with flexible repayment schedule

 

Risk

• Project risk until investment notional repayment
• Business risk after full repayment of the investment notional

 

Form

• Shareholder’s loan, capital investment or equity provided by the IFV

 

Conditions

• Interest as per agreement with project partners (to cover the cost of funds at least)

 

Typical project’s ownership structure and profit sharing after equity investment repayment

• Equity (IFV) – 50% - value of money put at risk as equity
• Subject (project owner) – 25% - value of idea, know-how, patent/license, start-up effort, …
• Management (as per agreement) – 25% - value of further management of the project
• Cost of management – 2% p.a. from project value
• Depends in reality on particular project – patent/license or know-how value, sophisticated management, level of risk, joint venture with some well-known brand, …
• IC as part of Equity can also be directly part of Subject and/or Management
• Shares can be held directly by FI and IC (Equity part as per IFV’s investment principles)
• Equity nominal for ownership and profit sharing purpose – all financial costs invested into the project so far (if any) plus equity needed to get standard bank financing

 

Repayment

• ASAP from bank financing replacing the equity or from operational profit (free cash)

Project investment

 

 

Project Investment Vehicle (PIV)

 

Ownership structure

• 50% - Financial Investor (FI)
• 50% - Local Partner (LP)
• 100% of shareholders’ rights necessary for change of the Articles of Association
• If any partner would like to exit the PIV then the other partner will have the right of first refusal to buy the exiting partner’s shares

 

Signatories

• Total number of signatories – 2 (FI  –  1, LP – 1)
• Acting – 2 signatories can act on behalf of the PIV only jointly

 

Bank account & accounting & running costs for FI representative

• Authorization of payments – same as acting on behalf of the PIV
• Fees and costs – cost for FI
• Revenue in the form of interest on account balance or basic bank deposit – income for FI

 

Funding

• Form - shareholder’s loan, capital investment or equity provided by the FI
• Cost of funds – TBA
• Currency – EUR

 

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Project investment principles

 

Life cycle

• Preparation – LP
• Approval – FI
• Ownership management – LP(management fee 2% p.a. from total investment notional until exit)
• Exit strategy/decision – LP+FI

 

Equity structure

• PIV's equity will be borrowed from FI at a fixed yield and guaranteed by pledged shares (initially 100% then proportional amortization in line with equity repayment) until full repayment of the notional with flexible repayment schedule (ASAP from bank financing replacing the equity or from operational profit - free cash)
• Additional mezzanine financing/bridge from investment bank for approx. 6% (later replaced by local loan for approx. 3-5% p.a.) if necessary

 

Profit sharing

• Profit=total income (positive cash flow after external funding servicing) minus cost of funds minus management fee
• FI – 80% (investment notional repayment) , LP – 20% (success fee) – until full repayment of the investment notional (if cost of funds will be 2% p.a. then no success fee for LP)
• FI - 50%, LP - 50% - after full repayment of the investment notional

Investment opportunities

 

Currently we have the following top investment opportunities in Slovakia&CE in our portfolio:

 

Shopping Centre (multifunctional real estate project)

 

We are looking for a financing partner, who would be interested to finance our comprehensive multifunctional real estate project that brings to residents new opportunity to live, work and make shopping. Project will comprise a complex of buildings – shopping centre (20.000 sqm), residence (16.000 sqm, includes 200 – 250 apartments) and office building (10.750 sqm).

 

Key facts and figures

• Invested equity EUR 13 000 000 - current major shareholder
• Equity increase by EUR 10 000 000 – financial investor (liabilities 7 000 000 – current minor shareholder will release his stake after liabilities repayment, 3 000 000 - projects and permissions)
• Bank loan 46 000 000/total equity 23 000 000
• Construction 46 000 000
• Pre-sell of residential part in 2nd year – financial investor’s equity repayment possible
• Office building can be fully rented by our partner (with additional purchase right)

 

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Residential real estate project

 

The project should be realized on a territory of 30 ha, project realization involves preparation of the whole territory, division into particular construction plots and a realization of public utilities on each parcel boundaries. In total, there might be 235 building plots, out of which 211 are designated for detached houses and 24 of them for terraced houses. The place for terraced houses and a square construction will remain the property of the company. In case of interest of individual landowners the company is also planning to carry out the construction of individual houses. The project counts on complex amenities such as gastronomy, wellness, offices etc., which will be situated on the square. A comfortable relax for residents will provide tennis centre, mini-football pitch, playground, kindergarten and a relaxation area full of park greenery. Project value is EUR 20 000 000 (equity portion TBA).

 

We are looking for a financing partner.

 

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New TV channel in Central Europe

 

The project of 2 separate TV channels in Czech republic and Slovakia with unified broadcasting structure has beside high profitability also interesting side effects and benefits for the financial investor. This project can be realised as a start-up or through acquisition of existing TV channels with the project value of 150 000 000 – 250 000 000 EUR (minimum equity EUR 50 000 000), can be easily supplemented by any country and/or language mutation distributed worldwide and could become the new leader on the TV market within 3 years on the both Czech and Slovak markets.

 

Major benefits of the project

• New, highly competitive and modern media channel, exploring new media opportunities such as internet and mobile communication
• Highly profitable
• More than 30% returns p.a. on the project, thanks to the synergies and economies of scale
• Positively influential and opinion-forming
• Contribute to the positive development in social, political and economic environment
• Support of investor’s domestic and international trade
• Protection and marketing of investor’s own investments

 

We are looking for a financing partner.

 

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Aircraft management company

 

Our company is holder of AOC (Air Operator Certificate) and commercial license in EASA

(European aviation authority) region.  Company has a team of very experienced professionals with low profile operation so its services are really cost effective. In order to provide highest financial transparency is every aircraft owner provided with access to company’s bank account (each aircraft has its own bank account) where he can see all transactions regarding his aircraft. Recently the company operates several aircrafts. Operation takes currently place in the Czech republic and France.

 

Company offers tailor-made services to cater business or private needs under EU licence, Airline Transport Pilot Licence training for groups as well as aircraft brokerage services.

 

Airline project

Project under preparation (expected minimum equity of EUR 10 000 000) or purchase of a well established European aircraft management company with 25 business jets under management (purchase price EUR 8 000 000).

 

Cargo airline project

Detailed business plan for small cargo airline operating in Europe has been prepared and is based on operating small cargo airplanes BAE ATP (payload 8 tons) with large cargo doors. Recently there is only one company operating in Slovakia with one B747 cargo. There is high potential for connecting businesses with lower sized airplanes. The company is looking for a strategic partner in cargo business. The start-up investment for the cargo operation is 1.5 million EUR.

 

Crew training – pilot license

We register high demand for qualified pilots in Asia and especially in China. The company is able to provide EASA ATPL frozen (Air Traffic Pilot License) training for adepts with zero experience. In addition due to globally raising requirements for language proficiency of airline pilots worldwide, we are able to train new pilots with adequate ICAO English skills. Estimated costs for theoretical training, flying course and English are approx. 70.000 EUR per pilot, however the exact price calculation depends on client’s requirements. Estimated time for the English course is 6 months plus 12 months ATPL training.

 

We are looking for a strategic partner in order to find additional perspective aircrafts’ owners for operation under our EU AOC and for a financing partner for above listed airline projects. Acquisition details on request.

 

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Physical agricultural commodities trading with own storage capacity and own river and sea port facility

 

Unique combination of purchase ability of agricultural commodities with local tradition, sufficient own storage facilities located at own river and sea ports with the possibility to upload the goods directly to ship or train for worldwide distribution.

 

We are looking for financial, shipping and worldwide distribution partners. Project value EUR 10 000 000, details on request.

 

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Physical international oil&gas trading

 

Our trading company is established and has all necessary licences in place. We have agreed

contract conditions with suppliers as well as with buyers. Current trading volume is financially secured.

 

To increase our trading volume we are looking for a strong financial partner who can financially secure the contracted trading volume (no need for real financing as our suppliers’ payment conditions are perfectly matched with our buyers’ payment conditions), details on request.

 

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New technology in water filtering, heating and cooling resulting into minimum of 25% of cost saving

 

Unique certified and patented technology successfully installed in hospitals, schools, heating plants (water heating, steam generation, ...), production halls, spa, ice hockey stadiums (increased ice quality and significantly faster ice freezing), ski resorts (snow generation units more efficient also at higher than usual temperatures), ...

 

We are looking for strategic financial, production and distribution partners. Detailed information on request.

 

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Production of rainwater infiltration blocks

 

Our target company has a unique certified and patented infiltration system technology for disposal of rainwater with own production capacity. The company is well established and has a significant market share on the local market with many installations for family houses, administration buildings, industrial parks and shopping centres resulting into elimination of rainwater disposal fee.

 

We are looking for strategic financial, production and distribution partners for other markets. Valuation of the company is in the EUR 1 500 000 area with significant growth potential. Acquisition details on request.

 

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Ecological waste treatment line with unique separation and thermal decomposition unit

 

The planned technology combination offers ecological waste treatment of 12,000 tons per year (separated waste representing 20% of the weight, however 80% of the municipal waste volume, prepared by the supplier directly at the dump by processing 60,000 tons per year) based on separation of material suitable for recycling (45%) and consecutive thermal decomposition of the non-sellable rest of waste (55%). Separated plastic material (as well as metal parts and carbon bricks representing together 12% of the thermal decomposition process) will be sold and the main product – oil representing 85% of the thermal decomposition – will be used as heating oil in 3 own cogeneration units for production of electricity with selling price of 149 EUR/MWh (1MWh will be sold and 2x0,5MWh will be used for consumption by own technologies included into the process).

 

Current status

The target company’s assets are plot of land, production hall, 3 cogeneration units (1+0,5+0,5 MWh) and thermal decomposition line under construction. Company has also all permissions for its activities in place. Alternatively there are several greenfield realizations prepared with similar financial parameters.

Key facts and figures

• Financing need of EUR 7 500 000 (equity EUR 3 000 000/bank loan EUR 4 500 000)
• Installation time 10 months
• Profit EUR 2 000 000 p.a.

 

We are looking for strategic financial, production and distribution partners. Detailed information on request.

 

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Licensed Electronic Money Institution - issues eWallets and prepaid cards allowing instant transfers and card usage world-wide

 

Excellent opportunity to become a strategic partner (to open new markets and attract new clients), a technological partner (to enhance the existing platform and to add new features) and a financial partner (minimum investment amount of EUR 3 500 000) in a well-established financial institution with positive EBIT.

 

The young and vibrant e-money platform offers:

• Ideal payment solution for merchants and private clients provides instant safe and secure way of moving money online
• A fresh alternative to the existing players in the industry
• For end clients unlimited instant transfers, easy access, privacy and convenience
• To merchants tailor-made solutions with a centralized back office

 

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Institution for IT education with unique eLearning, company training, career advisory and job seeking platform

 

We have developed a working model connecting IT companies, students, educational and financial institutions in order to prepare perspective young people  for the labor market. We help students, graduates and young unemployed people to find a job and successfully start their professional career. In cooperation with the leading IT companies, business and IT associations, we deliver certification activities as well as targeted educational projects.

 

The aim is through targeted online education and practical workshops the development of working, social and digital skills of young people (students and graduates of secondary schools and universities), as well as preparation for a job interview to the first employment or motivation to start one’s own business.

 

One of the most important outcomes is the opportunity to generate own structured CV, as it is a gateway to finding a dream job through our web based gamificated e-learning management system.

 

We are looking for business, educational, headhunting and financial partners to finalize our web based platform. More details on request.

 

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Game with marketing features - very first mobile application that rewards its players with prizes that can be used in the real life

 

Players

• Test logic and reflexes in this witty game that offers many interesting effects and twists
• Get many interesting vouchers either for playing the game or for winning over other players
• Put their logic skills to a test against their friends or other players
• Can bet their vouchers or coins in a very interesting multiplayer
• Can share, exchange or sell their wins on Facebook

 

Clients

• Unite both the world of gaming and marketing by renting their own icon and by offering players a reward
• Spread their brand awareness by having their companies‘ logo used as an icon in the game
• Reward users with vouchers after gaining certain amount of points
• Can even categorise vouchers by its count, discounted amount or its attractiveness
• Can send a direct message to all players: win a special voucher for the best player of the day
• Can display their logo as an icon, a voucher based on players’ selected region, time range and selected various categories of services

 

We are looking for strategic partners in order to find additional perspective marketing partners, clients as well as partners for new technology solutions and features for this unique marketing, online market and payment platform. Acquisition details on request.

 

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Music streaming solution

 

Streamer (fully automated interactive in-store radio generating a unique song queue for each venue according to music preferences of individuals and group of users automatically detected in a respective venue using a patent pending method and algorithm) and App (mobile app allowing every individual present at the respective venue an interaction with in-store radio installed in the venue, possessing variety free of charge and paid functions).

 

Used technologies and methods

• Music streaming solution providing a pool of music tracks and genders to be used by Smart radio algorithm
• iBeacon bluetooth detection technology allowing precise customisation of the playlist in every venue without the need to do manual inputs into the system
• Smart radio algorithm generating unique song queue for each venue according to music preferences of individuals automatically detected in a respective venue and considers various attributes such as preferences of individuals and groups of users, type of a venue, preference of venue operator, selected mood profile, etc.
• Analytics (Big data) providing detailed analyses of individual user's structure physically present in a respective venue, their customer's behaviour, plus providing opportunity for precisely targeted ads.

 

SEED investment of EUR 600 000 to cover a period of 18 months

• Financing the product development to final version with various technical and social features to be launched (testing of various marketing strategies and product features, "customer approved" concept)
• IP licensing rights and IT streaming costs during SEED phase
• Company costs including salaries of internal project team members
• Marketing and sales activities in Slovakia and preparation for further expansion within Europe
• Other miscellaneous costs necessary to spend during SEED phase

 

Round A – X

In next (growth) phase company would require further financing to cover expansion and growth to key markets in Europe and on other continents in later phases (financing in phases in years 2017 - 2019) until being able to switch to a more favourable way of financing (e.g. bank loans) or until getting to the breakeven point.

 

The amount of money for each round will depend on business and marketing strategy agreed between the company’s Management Board and SEED investor, considering product acceptance, market situation with speed of competition to enter the market and other factors, i.e. fast market coverage vs. balanced approach.

 

We are looking for strategic financial and distribution partners. Detailed information on request.

 

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Other investment opportunities we have in our portfolio (subject to project update) are following:

 

• acquisition of 49% stake in an electricity distribution company (low risk and well secured investment in the amount of 250 000 000 EUR, 40% equity needed)
• chain of 4 or 8 well established shopping centers (90 000 000 – 220 000 000 EUR)
• well established bank in Central Europe with full banking license and branch network (80 000 000 – 100 000 000 EUR) or financial institution acquisition/tailor-made establishment based on client’s needs
• gold mining project (150 000 000 EUR, 20% equity needed)
• personal railway transportation (project value 138 000 000 EUR, 15% equity needed)
• chain of specialized retail stores (500 000 – 3 000 000 EUR for max. 50% stake)
• finalized fotovoltaic power plants (multiples of 1 000 000 EUR)
• biomass power plant (greenfield project value EUR 13 500 000 with equity portion of 40%, profit EUR 3 000 000 p.a.)
• new construction material - certified and patented (minimum investment amount is 1 500 000 EUR)
• new technology in waste and recycling management (500 000 EUR)
• local commercial TV chanel (500 000 - 750 000 EUR)

 

We hope you will discuss these investment opportunities with your partners and that you will be interested into further detailed information about our projects and into cooperation on a particular project or on a portfolio of projects.

Our projects

 

Information on request.