Investment Process
QUADRIGA’s investment decisions are prepared in a structured process which initially attempts to identify attractive projects in an efficient initial review. Upon reaching the decision to proceed, the diligence process involves the assessment by our experienced investment professionals, business specialists working with the Fund, as well as a profound financial and legal diligence process. Due to the costs involved with the extensive diligence process, we only initiate this process once we are convinced of the compelling nature of the investment opportunity. The final investment decisions are conclusively decided by the Fund's investment committee and are based on recommendations provided by Quadriga Capital Russia's investment team.
Therefore if you believe that your business opportunity fits our investment parameters, you should send us a brief Business Plan (less than 4 pages) that contains the basic strategy and rationale for an investment.
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WE INITIALLY DO NOT EXPECT A COMPLETE AND COSTLY BUSINESS PLAN.
WE SIMPLY NEED A CLEAR IDEA OF THE PROJECT TO DETERMINE IF IT MAKES SENSE. |
Stage
2: Letter of Intent / Term Sheet
Following the initial review the project team usually determines the basic parameters of the investment (including structure, shareholding, basic terms and rights as well as the applicable exit mechanisms). This is then documented and agreed to in a letter of intent or term sheet.
- Agree upon the conditions of the investment
- Draft the letter of intent
- Carry out remaining due diligence
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AT THIS STAGE WE WOULD LIKE TO UNDERSTAND THE FEASIBILITY OF THE INVESTMENT AND TO DETERMINE ITS PARAMETERS AS QUICKLY AS POSSIBLE. OUR APPROACH ALLOWS US TO OPERATE EFFICIENTLY WITHOUT WASTING ANYONE’S TIME OR MONEY. |
Stage
3: Due Diligence & Negotiation
The final stage of the investment process consists of QUADRIGA and its external sources (including lawyers, accountants, and other industry experts) conducting an in depth due diligence process together with the company’s management team. At this stage, negotiations take place and the final investment structure is determined. Typically the time required for Stages 1 through 3 ranges from approximately from three to six months and largely depends on the preparedness and cooperation of the target company’s management team.
Final negotiations of the financial terms and conditions are based on the previously signed letter of intent.
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THE DECISION TO INVEST IS REACHED BY QUADRIGA CAPITAL'S INVESTMENT COMMITTEE. THE COMMITTEE CONSISTS OF THE INVESTORS’ REPRESENTATIVES AND EXPERIENCED MEMBERS OF THE QUADRIGA TEAM THAT ACT AS THE GOVERNING BODY OF THE FUND. |
Stage
4: Work as Shareholder
Subsequent to the disbursement of Funds and the purchase of shares, QUADRIGA becomes a shareholder in the company and QUADRIGA's local team members and its representatives become members of the company's Board of Directors.
How Quadriga Capital Russia typically works with its portfolio companies:
- QUADRIGA is represented on the Board of Directors by QUADRIGA's staff or other specialists.
- QUADRIGA usually has blocking rights comparable to those of a 25%+1 shareholder.
- QUADRIGA receives quarterly and annual reports on a regular basis from the company.
- QUADRIGA receives audited annual financial reports (preferably IFRS standards) from the company.
Stage
5: QUADRIGA's Exit
After completing the major development steps and reaching the set forward growth objectives, QUADRIGA will seek to sell its stake in the company, preferably together with its partners and co-shareholders.
Who can purchase QUADRIGA's shares?
- Industrial or financial investors (both Russian and foreign)
- IPO
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CONTRARY TO THE LOAN WHICH HAS TO BE REPAID, THE SHARES HAVE TO BE SOLD.
WE GENERALLY DO NOT WANT TO RESTRICT THE NUMBER OF POTENTIAL BUYERS AND SEEK A TRANSPARENT AND OPEN SALES PROCESS TO MAXIMISE OUR RETURNS. WE DO NOT EXCLUDE SELLING OUR SHARES TO THE CURRENT SHAREHOLDERS/MANAGEMENT IN THE EXIT PROCESS. THE QUESTION IS WHETHER THEY CAN AFFORD THE PURCHASE AT THAT TIME? |
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