RSPF investment instruments
Find out how investments will be structured and supported by the Regional Strategic Partnership Fund (RSPF).
Investments will be undertaken on a commercial basis through loan or equity arrangements but occasionally grants and concessionary loans may be used in certain circumstances.
As an example, non-commercial entities may be able to access funding this way.
Kānoa – REDIU will provide guidance to organisations about how investments could be structured, including terms of debt and equity arrangements.
The following is an indication of how debt and equity investments are likely to be structured.
- Our loans are generally non-concessionary with commercial terms, particularly if the project is for an export product.
- We can consider providing convertible or subordinated debt options.
- We will take best practicable security.
- The term of our loans is generally in the range of 3 to a maximum of 10 years, depending on project modelling.
- We can consider interest capitalisation and repayment terms (e.g. amortised, balloon, bullet).
- We will require acceleration and loan-review rights if particular events occur, such as a change in ownership, project scope changes and liquidity.
- We will require dividend pay-out restrictions to protect our loan.
- We will look to take a cornerstone shareholding, not a majority.
- We invest at fair value.
- We will generally take ordinary shares, but can consider preferential shares depending on the transaction.
- We will generally not seek to appoint directors beyond ensuring that an independent director is appointed. However, this will depend on the transaction.
- We will discuss the proposed exit strategy early in our discussions with you.