ESG Funding Opportunity Moody's BAA2 Rating

8 June 2021

Working capital support is key to enabling suppliers of corporates to co-invest in ESG initiatives to mitigate environmental impacts of manufacturing, support ethical sourcing and improve the livelihoods of those in our communities.

This funding opportunity is to support the working capital requirements of the suppliers of a global retailer. This includes the vendors to that retailer, and also the suppliers to those vendors, so there is a full upstream impact.

The process flow will be to fund corporate purchase orders and vendor invoices and the subsequent invoices of the suppliers to those vendors.

A repayment obligation underpins assurance on vendor risk and is structured around the investment grade retailer. Upstream vendor/supplier risk is managed through a variety of mechanisms including an offset provision for non-payment through the vendors receivables. There is a provision for insuring the risk, if required, however the dissipation of the risk across hundreds of suppliers, and the importance of the supplier in the corporates supply chain is such that insurance could be considered very low risk.

The quantum of funding required is estimated at £100m-600m, mainly in GBP/ EUR with some limited amounts in USD, with tenor of 30 -120 days, yielding 40-100 bps depending on the level of funding capacity. Funding capacity is agreed on an uncommitted basis and can be amended/cancelled at any time with a run off period for transactions already financed.

Funds distribution and repayment are all managed through the Crossflow technology-based platform, including AI engine to optimise yields. In addition, the scheme design is vetted by independent 3^rd party auditors, ensuring the authenticity of counterparties, and the underlying transactions, with the Crossflow service providing ongoing transaction monitoring.

For further information please contact Crossflow.

Disclaimer

This has been prepared from information believed to be reliable, to assist the reader and associated companies to make their own evaluation of the product and does not purport to contain all of the information that a prospective investor may require. The information on which this news is based has not been independently verified or audited. In addition, the writers and their advisors shall not be taken to be under any obligation to correct, update or revise this document, or any written or oral communications transmitted to the recipient, in the course of its evaluation of the opportunity. In all cases, the reader and associated companies must conduct his own independent investigations and analysis of the opportunity and the data set out in this document. They must rely entirely on such investigations and analysis and not on this document in relation to their assessment of the opportunity and form their own opinions as to whether or not to invest.  

Neither the writers, nor their advisors make any representation or warranty as to the accuracy, reliability or completeness of the contents of this document or shall have any liability (whether arising from negligence or otherwise) for any representations (expressed or implied) or information (including any projections) contained in, or for any omissions from, this document or any written or oral communications transmitted to the recipient in the course of its evaluation of the opportunity, except for any liability which may not be excluded as a matter of law. This document does not constitute investment, accounting, financial, legal or tax advice.  

The recipients of this information have acknowledged that they are habitual investors and that they are persons / entities whose principal business is the investment of money or who, in the course of and for the purpose of their businesses, habitually invest money. In addition, they acknowledge that the above-named offer is a private offer. The currency referred to in this pitch deck is Pounds Sterling unless specified otherwise.