Market Entry Program
A successful shipping company, which greatly scaled up its tanker traffic thanks to the sharp increase in crude oil prices between 2009 and 2014, plans to acquire a new fleet over the next three years. For this reason, its CFO recommended to the CEO (majority shareholder and Executive Chair) to explore a deeper market knowledge, develop a wider network of institutional investors, as well as expand their compliance capabilities with applicable regulations and best corporate governance practices. The latter with the purpose of having a more competitive capital structure to fund the purchase of tankers at a lower cost, without pressuring the company’s cash flows.
On recommendation by a client of IRStrat, the company contracted the Market-entry Program solution, with the mandate to assist in defining the optimal instrument to be issued and the most effective go-to-market strategy, as well as develop the capabilities necessary in the company to execute the placement.
IRStrat performs an initial assessment of the client's issuance capabilities, then, using the collected information, makes an ad hoc checklist of the objectives to be achieved, and defines the work schedule best suited for the company’s regular activities.
Our team, working with the senior management, begins to develop the company’s investment thesis, history and competitive advantage, and design the IR department’s structure and map the financial reporting functions.
IRStrat conducts a thorough training of our client's executive team, covering finance, communication and regulatory framework fields. The earnings release, annual report, corporate presentation and IR site are developed, as well as the company's corporate governance policies. After performing an intelligence report on the industry and market where our client operates, with the objective to better understand the intricacies of our client’s business and identify the potential players who will participate in the placing, IRStrat initiates a direct and effective approaching with those actors (underwriters, investors, credit rating agencies and specialized media).
Thanks to IRStrat’s negotiation skills and management capacity, our client receives multiple issuance proposals of 500 to 650 million pesos in unsecured local notes, 250 to 350 basis points below the financial cost of the second-best option, in this case, a syndicated loan. Additionally, our client develops the capabilities to comply with applicable stock market regulation in Mexico, the best corporate governance practices and reporting scope to carry out the placement of unsecured local notes; also preparing the groundwork for a potential Eurobond issuance or an IPO in the international capital markets.