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About Us
WHO WE ARE
FINDECO Ltd. (Financial Development Company) is an Investment Company set up to invest through acquiring holdings in companies that find themselves in so-called Special Situations.

Special Situations are transactions that, for reasons linked to the conditions of the company, property or management, require the construction of a corporate transfer route not compatible with auction procedures.

FINDECO shall invest especially in international companies. Investments are carried out by FINDECO directly or indirectly, through specially formed investment vehicles and/or sub-holdings, depending on what is more efficient from time to time.

ACTIVITY

Below we have listed some examples of companies which might find themselves in Special Situations. These cases, amongst others, according to the management are the subject of investment by FINDECO:
  • companies that, operating in particularly fragmented sectors, are not big enough or do not possess the suitable managerial and/or financial capabilities to pursue their growth targets, which could instead be achieved through aggregating or merging with companies operating in the same sector or in complementary sectors; 
  • companies where succession or generational problems at the level of controlling shareholders have had negative effects on management, on the capacity to generate profits or on the implementation of a long-term operational and financial strategy; 
  • companies derived from spin-offs or discontinuation of company branches, or companies derived from the sale, by corporate groups, of non-core assets and of non-strategic divisions that represent a significant potential of performance improvement, but have reduced financial and managerial resources dedicated to growth; 
  • non-performing companies subsidiary of private equity funds, or companies deemed as problematic in relation to the poor financial results or to levels of debt not compatible with cash flow generation forecasts; 
  • companies that require an operational turnaround or companies with EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) margins below sector standards, which represent opportunities for improvement; 
  • companies that require financial restructuring, or companies that record positive operating results but that are unable to pay off their debt and to manage and/or support the investment necessary for growth. In such cases, in consideration of the high level of debt and/or a debt/capital ratio excessively unsettled, FINDECO's investment could be subordinated to an accounting and financial restructuring or to finalising arrangements with creditors, or equivalent forms; and 
  • companies subject to insolvency proceedings (such as, for example, arrangement with creditors or extraordinary administration).

STRATEGY

FINDECO invests mainly in industrial and service companies, with particular caution towards sectors subject to rapid technological obsolescence. Target companies are usually those with a turnover between 30 and 300 million Euros (so-called “small and medium enterprises” or “SMEs”).
 
The Company intends to allocate, for each investment in a target company, an average value between 20 and 30 million Euros in terms of risk capital invested by FINDECO. It will also be able to make bigger investments, should it avail itself of the financial capabilities and collaboration of other investors.
 
The investment activity is mainly carried out through acquiring controlling stakes in the share capital of the company subject of the investment.
 
FINDECO shall be able to exert control also jointly with other investors, following on from finalising with them shareholders’ and joint-investment agreements aimed at regulating significant aspects of the company’s business (such as, for example, approval of strategic plans and management selection) as well as the terms and conditions of disinvestment.
 
The members of the Management Team can be part of said companies' governing bodies, or hold operational roles on the boards of said companies, actively supporting the executive management in achieving the recovery process.
 
Moreover, FINDECO can acquire minority stakes, where deemed appropriate by the Management Team. In such cases, agreements would be reached with the majority shareholders with regards to governance to ensure a satisfactory level of protection of the investment, including a clear exit strategy for FINDECO.
 
In addition, FINDECO can implement its strategy also through investing in target companies its own financial resources in form of debt, such as for example:
  • granting high yield subordinated debt/mezzanine, which attribute conversion rights into equities, or which are assisted by guarantees on the capital and/or the assets of the companies themselves; and
  • purchasing non-performing loans held by business creditors, banks or financial institutions. Such liabilities investments could be carried out alongside equity investments in the companies in question, and shall be carried out only as part of a pro-active strategy of investment management.
 
The average time horizon of the investments that FINDECO intends to make is three years, corresponding to the reasonably necessary period to achieve the conditions to re-launch and recuperate the profitability of companies in Special Situations.

SELECTION

The members of the Management Team have developed a large network of relationships in their respective professional expertise, including contacts with important executive managers, entrepreneurs and company directors, as well as with experts working at commercial banks, investment banks, accounting firms and legal practices.
 
In particular this large contact network, which contributes to create significant investment opportunities forFINDECO, includes:
  • managers and Industrial Partners who have gained significant management expertise and skills in industrial contexts subject of FINDECO’s investment strategy;
  • target companies themselves, which could create further opportunities for investments with competitors, clients and suppliers;
  • professionals (lawyers, tax consultants and accountants) trusted by the target company who, being aware of the dynamics proper of the company, are often able to highlight the imminence of a situation of financial or industrial difficulty;
  • entrepreneurs, who usually are a good source of information on companies operating in their same sector or similar sectors;
  • corporate consultants who provide support to companies in financial or industrial difficulty in the context of elaborating and implementing corporate recovery and restructuring plans; legal practices based in the territory and specialised in bankruptcy law;
  • private equity funds holding stocks in the share capital of companies with an unsustainable level of financial debt; banks holding direct stocks in companies undergoing difficulties who are unable to meet their financial commitments; and
  •  investment banks, consultants or other intermediaries tasked by the shareholders of companies or who are aware of companies that are in Special Situations.
 
With reference to the internal procedures for the examination and approval of investment opportunities, each transaction is subjected to the formal approval of the Management Board, which evaluates such investment opportunities according to the best practices of private equity funds.
 
In particular, the procedure of evaluating opportunities to make investments would usually be based on:
  • carrying out adequate legal, accounting, commercial, tax and, where applicable, environmental due diligence;
  • drawing up of a business plan (where necessary, validated by FINDECO’s independent financial and industrial consultants involved in the acquisition process) shared, where possible, useful and/or suitable, with the management of the target company; and a financial analysis that highlights a satisfactory expected yield on the capital invested for a period of three years.
 
The same procedure is also carried out to examine and approve the investment opportunities in Special Situations via the issuance of debt instruments represented by subordinated and/or mezzanine debt or the purchase of non-performing loans issued by credit institutions.

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