Global Specialised Finance
Global Specialised Finance (GSF) provides integrated, multi-faceted structured financing solutions covering the full range of advisory, arranging, underwriting and lending services. The group provides services to wholesale bank clients, mid-caps, the Sparkassen and other investors, and is arranged into seven sectors:
- Project Finance
- Leveraged Finance
- Commodity Finance
- Transportation Finance
- Structured Products
- Special Investments Group
- Forfaiting
Project Finance delivers finance solutions to companies undertaking major development projects. WestLB is traditionally one of the world’s strongest project financing houses.
We cover the areas of energy, oil and gas; metals and mining and infrastructure and telecoms and offer a range of services including:
- Advising
- Structuring
- Arranging
- Underwriting
- Lending and syndication
- Limited/non-recourse project and acquisition debt finance
- Equity investments
- Financial engineering
This team also originates and executes advisory and Lead Arranging Mandates of non-recourse financing transactions, including senior and subordinated debt, for start-up companies and refinancing opportunities for more mature firms. We also look at sub-investment grade ventures.
Financing is made available based on a comprehensive evaluation of the future cash flows of a company as well as a critical assessment of the management, choice of technology, and the regulatory environment.
Our clients include international power and energy and metals and mining corporations, telecom operators and equipment manufacturers, contractors, service providers, financial investors and public institutions.
For example, recently WestLB acted as the Mandated Lead Arranger and facility agent for a €700m refinancing of Austria’s third largest mobile operator, One GmbH, owned by E.On, TDC, FT and Telenor.
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Leveraged Finance provides leveraged loans with significant underwriting capability to clients involved in various forms of Leveraged Buy-Outs (LBOs).
This means the team provides a range of senior, subordinated, mezzanine and other debt financing products including bridge financing and warehouse structures to our customers, focusing on:
- Origination
- Structuring
- Arranging
- Underwriting
- Distribution
Our clients are mainly financial sponsors and private equity firms specialising in medium and large-sized LBOs, institutional buyouts and corporate acquisitions with debt financing requirements. We also provide finance solutions for Management Buy-Outs (MBOs), Management Buy-Ins (MBIs), Buy-In Management Buy-Outs (BIMBOs). The team also generates arrangement opportunities for other areas of the Bank such as corporate finance, securitisation and investment banking. We are one of Europe’s leading teams and cover all sectors, primarily focusing on Europe, but with the prospect of selective transactions in other regions.
Recently, WestLB acted as Joint Lead Arranger of CVC’s 2005 acquisition of Ruhrgas Industries as well as being the Mandated Lead Arranger in CVC’s 2003 acquisition of Danske Trælast.
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We provide financing, including pre-production and pre-export financing as well as providing further funding for international trade houses, producers of commodities and enterprises involved in export or import.
The basic condition of all commodity finance arrangements is a self-liquidating commercial commodity transaction with emerging market producers. We focus on:
- Pre-production and pre-export financing
- Loans to traders financing advance payments
- Direct loans and financing of sales to emerging market producers
- Loans to producers for purchasing/converting raw materials
- Tolling/processing finance
- Counter trade
- Credit to finance the sale or lease of chattel equipment to emerging market producers, making use of various forms of (semi) buy-back structures
Our clients are mainly international trade houses, producers of commodities and enterprises involved in export or import in OECD countries and emerging markets.
Recently, this team was awarded the “Deal of the Year 2004” by Euromoney’s Trade Finance Magazine. Examples of recent deals include arranging $45 million iron ore pre-export financing for Ferrexpo, UK/Poltava GOK in the Ukraine and a $60 million term loan, pre-export finance and export finance facility for Coal Krutrade in Russia.
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We provide finance solutions for acquisition and/or operation in the transportation and logistics sector.
These finance solutions range from relatively straightforward secured loans to complex structured lease financings. We are involved in both aircraft and ship financing and have been involved in successfully marketing Japanese operating leases to European airlines.
Our key clients include airlines, major aircraft manufacturers, operating leasers and ship operators.
Recent deals include:
- December 2004: WestLB was Agent and Security Agent for a $50m pre-delivery financing for Australian low cost carrier, Virgin Blue, in respect of six Next Generation B737-700/-800 aircraft. We underwrote $25m.
- February 2005: WestLB was the Managing Lead Arranger, Facility Agent and Security Agent for a $150 million ticket receivables deal for Russian carrier, Aeroflot, where we underwrote $37.5m. The deal’s supported the airline’s general corporate purposes as well as investment in a new terminal at Sheremetievo Airport.
- February 2005: WestLB was overall arranger and lender for a $106m senior debt into Japanese Operating Leases (JOLs) for Malaysian Airline Systems Boeing B777-20ER.
- March 2005: WestLB was overall arranger and lender in a $210m senior debt JOLs for two Lufthansa Airbus A330-300 aircraft.
We develop new and tailor-made structured solutions to meet our client’s financing and investment objectives with a view to optimising tax and capital efficiency. The Structured Products Group develops tax efficient investment and financial products and lease based products and solutions. A leased based product is a financial product that provides clients with a means of financing the acquisition of an asset on a more tax efficient basis, and often with more favourable accounting treatment, when compared to the client purchasing the asset with borrowed funds. Lease based funding has been a popular source of financing over the last decade, though changes in regulatory, accounting and tax rules in many key jurisdictions have resulted in many changes to the structures used.
Given the constantly changing international accounting and fiscal environment, structured solutions is becoming increasingly attractive to many of our clients.
Our main market is the UK and Europe and our key clients include major financial institutions, large multinational corporations and public sector entities in various jurisdictions.
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This group, SIG, is a proprietary investor in distressed or stressed debt and other high yielding opportunities.
This means we purchase loans, bonds, receivership/administration assets and other instruments usually at a discount to their face value, reflecting the impaired nature of the underlying business or asset or where the true value is not properly appreciated.
SIG finds opportunities in the public and private markets, usually purchasing directly from original lending institutions or via brokers. Given the nature of the business, positions are typically taken on as investments rather than as short-term trading positions.
We have made investments in a number of European countries including UK, France, Italy and Switzerland. An example of a recent deal is the acquisition of a portfolio of 426 non-performing mortgage backed loans from an Italian bank.
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WestLB Forfaiting is recognised as the premier Forfaiting Institution within the trade-related debt market. It has received the accolade of “Best Forfaiting Institution 2004” from the Trade and Forfaiting Review.
This area of the Bank provides pre-export financing, post-shipment financing, down payment and local cost financing and counter guarantee of Letters of Credit.
In essence, forfaiting is a medium term (six months to 10 years or more) form of export trade finance in which the forfaiter (WestLB) purchases a form of debt issued in relation to a cross-border commercial transaction. This can be purchased either directly from the beneficiary/exporter (primary market) or from other financial institutions (secondary market).
The debt can be in many different forms such as a Promissory Note, Bill of Exchange, Letter of Credit, Loan Agreement or Book Receivables and is purchased at a discount on a non-recourse basis. The debt is essentially an expected future trade receivable discounted backwards. Once acquired, the debt is then distributed to our clients in the secondary market.
On the origination side, we help our clients to eliminate credit, political or transfer risks and improve cash flows in cross-border transactions. On the distribution side, we provide our clients with investment opportunities in a diversified asset class.
Recent deals include:
- Financing an Akbank Turkey Letter of Credit for $55million for 12 months for imports of oil by Tupras.
- Providing a $10million 12 month import financing facility to Gazprombank Moscow to cover gas equipment deliveries.
- Providing US$20 million financing for Fujitsu-Siemens to cover the supply of IT licences to Romania for five years.
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