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Our financial strategy

CSP prefers financing situations whereby the company as a whole is concerned and where tailor made financing solutions are requested. Next to growth financings, which go beyond traditional bank loans, CSP is able to offer financing solutions for succession planning and act as a long term partner in refinancing situations. CSP’s financial flexibility and solution driven approach helps to offer owners and managers the most suitable financing proposition for their business.

 


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Minority & preferred equity

  • silent partnership
  • Hybrid structures
  • minorities up to 25%
  • in private and listed companies
  • located in DACH region
  • board seat

Unitranche, subordinated debt & growth capital

  • Private debt
  • invested as senior and subordinated
  • in private and listed companies
  • located in Western Europe
  • covenants and sufficient information rights

Complex situations, including secondaries & stressed debt

  • Private debt
  • located in DACH, Benelux & UK
  • in private and listed companies
  • Attractive loan to value
  • sufficient covenants and information rights

  • Focus on small to midsized companies in Western Europe, which are offering special investment opportunities
  • Defensible, cash generative businesses (EBITDA > €5m), or growth businesses with high barriers to entry with a target debt ticket sweet-spot of €10-20m per transaction (minimum ticket size €5m)
  • Core geographical focus: DACH region, Benelux and UK
  • Application of disciplined "private equity-style" diligence process to debt investing
  • Fundamental, value-driven approach, focusing intensively on each underlying investment
  • Particularly suited for family-owned businesses
  • Provide hybrid debt/equity structures to enable for example major acquisitions or transformational change
  • Family or existing shareholders maintain control of the business
  • Succession planning through partial sale of minority stakes, typically 
  • Support of organic growth and development of the business, as well as possible add-on acquisitions
  • Post transaction active monitoring with board representation

Selection criteria

During our company selection process, we follow clear selection criteria.

We apply clear selection criteria that enable us to execute our financing strategy consistently and allow us to utilize significant resources to support the portfolio company's development. CSP follows a disciplined financing and due diligence approach; often we know the companies we finance for a long time and developed a deep understanding of their market, business model and growth opportunities as well as the challenges the businesses are facing.

 


Company criteria

CSP has well-defined company selection criteria:

> Recession-resilient business model

> Recurring revenue base

> Strong cash flow

> Sufficient, also subordinated, collateral

> Clear business strategy


Recession-resilient business models

  • Company's products or services are essential
  • Business model has good visibility on revenues i.e. multi-year contracts

Organic market growth of at least 2%

  • Market growth supported by long-term secular trends
  • Demand for product/service is often not discretionary

Strong cash conversion

  • Adequate EBITDA cash conversion
  • Good payback period on capex investments
  • Sustainable cash flow profile to service debt

Appropriate covenants & tight monitoring

  • Appropriate covenants leaving room for CSP to take necessary actions in adverse situations
  • Board observer seats and close monitoring

CSP will invest in stable, growing businesses that are able to deliver consistent growth to drive value creation and maximise returns


Financing volume

CSP only finances established businesses:

that meet most of the before mentioned criteria. CSP’s investment sweet spot: between € 5-20m per transaction. Preferred company size: sales of € 20-100m and EBITDA of at least € 5m.

Together with its investors, CSP is able to structure single financing transactions of up to € 50m.


Sector Focus

CSP is able to finance across all sectors.

We are looking for defensible, cash generative or growth businesses with high barriers to entry and strong cash flow generation. So far we have found these traits most often in the business and financial services, technology, consumer and retail, healthcare, industrials and (digital) media sectors.


Core Geographics

The geographic reach of CSP’s financing activities is Western Europe, whereby German speaking countries and Benelux represent the core geographic focus.