The Channel logo

News

By | Team Register 5th January 2005 13:39

Magirus PREPS capital base

New financial instrument

Magirus, the Germany-headquartered mid-range distie, last month increased its capital by €18m using "a new kind of financing instrument" arranged by the Capital Efficiency Group (CEG), of Switzerland.

Called PREPS (preferred pooled shares), the instrument is a type of profit participation capital - "subordinated capital which, due to its liability basis, assumes an intermediate position between genuine equity capital and borrowed capital".

"This form of financing offers a number of advantages," says Ulrich Schöttle, executive veep and CFO of Magirus AG. "The fact that this capitalisation measure reinforces the business equity capital of the company leads to a clear improvement in the balance sheet structure, credit standing, and rating. A welcome side-effect of the improved 'key figures' that we expect is a reduction in the remaining costs of credit. Furthermore, no collateral needs to be provided for this type of financing, which means the collateral remains available for other forms of financing and expands entrepreneurial freedom. Other advantages are the tax-deductible nature of the financing costs as well as the favorable terms in comparison with earlier financing options of this type." ®

alert Send corrections

Opinion

Alexandre Mesguich

Change is order of day as tech giants shift strategy gears
Partnership

Frank Jennings

Confused? No problem, we have 5, no 6, no 7... lots of standards

Chris Mellor

VC sequence could end not with a bang, but a whimper
Sad man stares glumly over boxed contents of desk. Image via shutterstock (Baranq)

Features

money trap conceptual illustration
Big boys snare the unwary with too-good-to-be-true deals
Angus Highland cow
Pet carriers not wanted for whitebox stampede
FBcoldstoragearray
Sorry OpenStack and Open Compute, we're not all Facebook
Gary Kovacs, CEO of AVG. Pic: World Economic Forum
Scammy download sites? Government snooping? Run of the mill for Gary Kovacs