PRIVATE EQUITY

The private equity sector is experiencing an era of extensive changes in Spain. The context of financial crisis and recession is transforming the customary models and patterns, both with regard to fundraising as well as to investment and transactional activity.

The difficulties in raising funds are provoking greater competition among funds. Other relevant aspects are being joined with the investment track record which LP's are beginning to also take into account, before deciding on making an investment. The management of the relationship, the capacity of the GP to adjust to the individual situations of investors, without compromising the financing needs that may arise in the life of a fund, and without discriminating against some investors vis-à-vis others, etc., are aspects that are gaining greater importance in the scenario of limited funds.

In that context, the funds' formation activity is becoming more and more internationalized. Spanish fund managers are seeking foreign investors and foreign funds are initiating fundraising efforts in Spain in order to offer investment opportunities in economies with greater growth. Our team, with attorneys present in our London and New York offices, has experience to provide legal support to that cross-border fund marketing activity. We customarily carry out, for foreign investors, audits of Spanish funds and investment vehicles. We also advise Spanish clients who wish to invest in vehicles and funds in other countries. This advice on the formation of funds in other jurisdictions is coordinated with other first-rate firms. Our tax specialists are familiar with the carry and investment structures used in the various jurisdictions and are well aware of the tax implications involved in this trans-national investment activity.

The instability of the markets and, in particular, the situation of the Spanish credit market, are also affecting the investment activity of funds. Given the scarcity of traditional credit, it is necessary to design flexible financing structures, not only for the acquisition, but also to finance the development of the post-acquisition business plan. It is becoming more and more common to see loan to own transactions, debt issues, hybrid capital and debt structures as well as complex vendor finance systems. Our team has extensive experience on the design of these types of structures, advising funds in order to facilitate the closing of the transaction by way of innovative at times of major complexity, flexible, proposals, at times of major complexity, tailored to the characteristics of the deal and the specific needs of the intervening parties.

But investment activity is not only becoming more complex and sophisticated on the financing side. Other aspects come into play which often require that the advisor be capable of providing a global response to the investor: an environment that is more and more regulated, which makes it necessary to be familiar with the regulatory and compliance context in which the potential seller moves and which may affect or condition the transaction; a tax environment entailing limitation of deductions, which tends to reduce the investment's margin of return; a more and more international and sophisticated market; greater competition which often translates into the need to structure more creative proposals for contributing value on the part of the investor; a difficult economic environment which often places targets in distress situations that require the investor to perform a careful evaluation of the risks associated with the investment. All of this translates into the need to offer complex, integral, more and more international legal advice, yielding greater added value.

Gómez-Acebo & Pombo has developed a complex, sophisticated practice which, through a multi-disciplinary team, makes available to funds and their managers useful tools for confronting such a changing, complex environment.

Our advice includes:

  • Design and tax structuring of transactions.
  • Advice on the negotiation and drafting of contracts for all types of investments (LBO's, MBO's, secondaries, public to private transactions, turn around transactions, recaps) and the financing thereof.
  • Advice to managers and owners who seek private equity in search of funding for their companies.
  • Exit and divestment processes, including going public and the Alternative Stock Market (MAB).

Within the team there are also three sub-specializations: Formation of Funds, Private Equity and Special Situations.

The Formation of Funds group specializes in fundraising processes, incorporation of Venture Capital Entities, structuring of carried interest systems, relations with the CNMV, audits of Venture Capital Entities for institutional investors and funds of funds.

The Private Equity group has a consolidated experience in advising funds and promoters of start-ups, both in the initial as well as in the development phases, and in the funding thereof (MAB, venture debt, financing rounds, etc.), especially in the technology and Internet sectors.

The Special Situations group provides recurrent advice to funds and investors on the structuring and execution of debt acquisition transactions, hybrid capital and debt transactions, the purchase of distressed assets, NPL's and other complex assets in regulated sectors.

DISTINCTIONS

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The team is "extremely professional, very responsive and creative."

"I think the service is very good, they are flexible and they respond quickly."

The Chambers Europe 2017. Private Equity

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"They are very attentive towards the client."

"Their availability is better than other firms."

The Chambers Europe 2017. Corporate/M&A

 

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Sources are impressed by the firm's ability to "read between the lines of the laws and regulations," explaining that "they go beyond what is written to find the course of action. It is a capable and expert team".

"The co-ordination with other jurisdictions and offices was excellent."

The Chambers Europe 2017. Investment Funds

 

 

chambers partners

"The lawyers have strong commercial skills and the ability to negotiate and explain issues in English and Spanish."

"The lawyers' preparation of meetings was well thought through and they had always come up with solutions beforehand."

The Chambers Europe 2016. Investmet Funds

 

chambers partners

"Lawyers need to have a very specialist knowledge for private equity and they are able to tell you exactly what the issues are."

"The team is extremely responsive."

The Chambers Europe 2016. Private Equity

 

chambers partners

Sources say: "The team is extremely efficient and organised, and it is available at all hours, day or night. It's inventive in its strategies and the client service is fantastic. The team is very good at understanding and dealing with the cultural differences".

The Chambers Europe 2013. Private Equity

 

chambers partners

The private equity team at this Spanish firm is made up of finance, tax and corporate specialists, and advises on a range of private equity, fund formation and venture capital mandates.

The Chambers Europe 2012. Private Equity

 

chambers partners

This popular domestic firm has boosted its private equity offering with the creation of a new standalone private equity practice.

Sources say: "I was extremely satisfied with the service: the team provides deep legal expertise combined with a commercial and strategic approach".

The Chambers Europe 2011. Private Equity