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Given the unique deal structures that Hercules employs , obtaining warrants than can convert into equity, the company is well positioned to enjoy some nice returns in the event of an acquisition or initialpublicoffering (IPO) from one of its portfolio companies. Image source: Getty Images. Horizon Technology Finance: 9.9%
This lets Hercules benefit from some of the upside of a liquidity event for one of its portfolio companies, such as an initialpublicoffering or a sale. There are many companies in need of capital or advisory services, but they are not big enough or deemed suitable by investmentbanks.
Hercules typically adds warrants to its deals, giving it the ability to receive shares and profit from an initialpublicoffering (IPO) or an acquisition of one of its portfolio companies. What makes Hercules even more special is how it structures deals. During the past 10 years, Hercules has a total return of 218%.
Dee Kuchukulla (New York) guides leading private equity sponsors and their portfolio companies on an array of complex transactions, from leveragedbuyouts and sales to carve-outs, cross-border deals, joint ventures, and take-privates across industries. She brings a deep understanding of technology and consumer brands.
“On things like NAV loans and margin loans, it’s just additional leverage and if things go against you, you can have a problem,” Stavros, KKR’s cohead of global private equity, said at the Berlin event. Many were acquired at the buyout boom’s zenith in 2021 and 2022, and often paid for by piling them up with floating-rate debt.
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