Private Equity: Alternative instruments and strategies

2021-04-16T12:37:00
Spain

Legal considerations of private equity funds and financial sponsors adopting alternative investment strategies other than buyouts. 

Private Equity: Alternative instruments and strategies
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April 16, 2021

In recent years, an increasing number of private equity funds and financial lsponsors are adopting alternative investment strategies different tfrom traditional buyouts, and many traditional funds have redefined dor diversified dtheir strategies and products. On the one hand, companies are increasingly seeking the alternative financing goffered by this type of funds in transaction structures that allow them to retain control. On the other hand, the need to stand out in a competitive environment, to gain exclusive transactions and avoid bidding processes, is also a factor that is compelling funds to be more creative when generating opportunities and designing investment structures. Further, such alternative strategies will most often result in innovative structures and instruments (minority investments, preferred equity, hybrid debt / equity instruments) since they are often more flexible eand can be adapted to the company’s needs and to the risk profile eand return targets of different ttypes of investors.

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April 16, 2021