Mezzanine - Strategy and positioning
Mezzanine financing partner
Mezzanis is Crédit Agricole Private Equity's activity that specialises in mezzanine financing. First launched in 2002, the mezzanine business invests mainly in unlisted mid-market companies with high potential and an enterprise value of less than €300 million.
Our mezzanine financing strategy: controlled risk for qualitative deals
Mezzanis provides mezzanine and quasi-equity financing for all business sectors in France and Europe. It covers all types of deal including leveraged buy-outs (LBOs) in partnership with financial investors and management, recapitalizations, capital restructurings and financing for internal or external growth. The typical deal size is between €5 and 15 million but Mezzanis can invest as high as €30 million either alone or in consortium.
Mezzanis continues to pursue its strategy of quality over quantity and performance over volume. We therefore take a controlled approach to risk by carrying out a comprehensive analysis of proposals and seeking an adequate return for our risk.
Customized mezzanine financing solutions
Mezzanine financing is a midway house between debt and equity, mainly in the form of bonds with share warrants (OBSA).
In a highly standardised structured debt market, which limits the durations of loans and levels of leverage, and faced with the high rates of return demanded by private equity investors, mezzanine financing offers flexible solutions able to guarantee investors in Mezzanis’s funds a stable and high rate of return.
Mezzanine financing is mainly used in leveraged buyouts (LBOs/LBMOs) or leveraged build-ups (LBUs) carried out by financial investment funds or industrial players (corporate acquisitions).
It can however also be used to provide financing for internal or external growth, to strengthen shareholders' equity, for example ahead of an IPO, or to restructure a company's capital in preparation for a change in the shareholder structure or a buyout.
An investor-led approach
Midway between debt and equity, mezzanine financing often has a quasi-equity status, particularly with regard to the company’s other priority lenders. This is why investors providing mezzanine financing see their investment as a medium/long-term partnership with the management and shareholders of the financed company, and derive part of their remuneration from the additional value created by their investment.
