Comment july

Comment july 7/18/08 2:55 PM Page 1COMMENTASSET FINANCENothing ventured, nothing gained – the appeal of assetfinance to investorsNow’s the time to source investment, although private equity has risksDerek Soper early stage of development that have perceived The investor almost certainly will require along-term growth potential; to develop new seat on the board, usually as a non-executiveAsset finance companies that require products, services and technologies; to expand director, or even as chairman.additional funding will probably be working capital; to make acquisitions; or to Investors focus on the prospect of aconsidering the desirability and feasibility of strengthen a balance sheet. significant financial gain.The potential exitattracting external investment. If so, they value of a company is a vital part of thewill have to decide whether it is better to investors’ thinking.They will be keen to“Investors focus on the prospect of aown a smaller slice of a potentially larger know where the probable exit route will liesignificant financial gain. Thepie, or lack funds and slow down their even before the investment has been made.potential exit value of a company is abusiness while continuing to own a large The company’s management should notvital part of the investors’ thinking.”share of the business. assume that their exit will coincide with thatThe asset finance industry appeals to of their investor.investors because of its regular and An important ...