Guarantee
For your commercial export contracts you are often faced with the obligation to pre-finance these contracts and to provide bank guarantees for the client.
If you are investing abroad, since the assets to be financed are situated across borders, your bank may experience difficulties financing them.
Whatever your international project, SOFINEX allows you to access bank credit more easily through granting a guarantee to reduce the risk for the bank.
Guarantee to cover “commercial” credits
Guarantee to cover investment loan
How to obtain a SOFINEX guarantee
By contacting your bank direct to present your project. Your bank will analyze your application and take the necessary steps to introduce your file to SOFINEX.
However, prior contact may be made with SOFINEX.
Example of a guarantee
An opportunity presents itself to company X to take over a construction materials distribution company established in the South of France. This purchase would allow the company to reach new markets in the South of Europe and to extend its product range. The total amount for this acquisition is 500 000 euros.
The company dips into its available funds and immediately puts up 20% of the needs in connection with its foreign development. SOFINEX then supports it with a subordinated loan and through the granting of a 50% guarantee on the bank financing.
| Expenditure (EUR) | Sources of financing (EUR) | |||
|---|---|---|---|---|
| Amount | Amount | |||
| Acquisition foreign company | 500 000 | Own effort (self-financing – free cash flow) | 100 000 | 20% |
| SOFINEX (5-year subordinated loan) | 100 000 | 20% | ||
| Bank (5 year-investment loan) – 50% SOFINEX guarantee | 300 000 | 60% | ||
| Total | 500 000 | Total | 500 000 | 100% |
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