While, in much of the world, commercial lenders continue dominant providers of project finance, corporate and municipal/local government debt, there is an increasing role for debt capital markets financing (bonds).  In a few markets such as the United States, the capital markets (the bond markets) already provide the dominant source of debt funding within many of these sectors.  In the European banking sector, compliance with "Basel III" regulations has recently restricted the quantum and types of loan and credit facilities commercial banks could provide to borrowers such as infrastructure project companies, utilities, telecoms and industrials to finance their projects.  In these sectors, both in Europe and other global markets, we have seen a general "tightening" of credit supply and a reduction of tenors for many of these credit facilities in the sectors and markets that we cover.


The above conditions, coupled with a growing demand for longer tenor debt from institutional bond investors has resulted in greater applicability for bond financing of infrastructure, energy & utilities projects and other large capital projects.  Governmental agencies and multilaterals have also developed many new guarantee and other credit enhancement products and direct and indirect credit backstops, designed to facilitate bond investors in many critical infrastructure and energy & utilities financing projects and corporate financings.  Debt capital markets transactions can be relevant for the following types of financing projects:


  • Project Financing Project financing bonds used to finance an infrastructure project (new-build, rehabilitation/renewal), an industrial plant or facility and purchase of equipment, or other large capital project.  Certain types of bond investors may not be authorized to take any construction development risk and perhaps may only participate after commercial operations is achieved (or the bond and guarantee structure mitigates development/construction risk exposure).


  • Acquisition FinancingAcquisition bonds, notes or debentures used to fund the leveraged acquisition of a company or an existing asset.


  • Corporate Financing.  Corporate bonds, notes or debentures used to fund all general corporate purpose activities, including capital investments, working capital, liquidity and share repurchases.


  • Lease and Asset-Backed financing Lease-backed/Asset-backed securities (LBS/ABS) used to financing an acquisition of capital assets or equipment by a leasing company (lessor), which are, in turn leased to a lessee.  In this case a  LBS/ABS would finance the acquisition of the capital assets and equipment and the lease payments paid by the lessee will be used as repayment to the LBS/ABS holder.  Leasing, as opposed to purchasing capital assets or equipment, can in some cases be advantageous to our clients in comparison to purchasing, from a tax and accounting perspective.  Also, in certain cases our clients, who are owners of capital assets and equipment will find it advantageous to enter into sale-leaseback agreements (which is a form of monetization).


  • Securitization Securities.  Asset owners such as companies and governments (or government instrumentalities) may wish to "carve-out" and "securitize" specific capital assets or "monetize" future revenue streams through a capital markets securitization.  In the case of a monetization/securitization structure, the asset- or revenue-backed security holder will provide a (usually amortizing) note that may be secured by a collateral pledge of the underlying capital assets and/or a pledge of certain future revenues streams.  Proceeds from monetization/securitization transactions may be used by corporate or government borrowers to fund other capital investments, acquisitions or to provide corporate liquidity.  Monetization/securitization financing may be an alternative to selling (or privatizing) companies or assets.


DCS is an independent advisory firm and we are not a licensed investment bank in any of the regions we serve.  Therefore, we cannot offer full service debt capital markets services, such as regulated bond underwriting, agency and syndications services fore registered securities.  However, DCS assists our borrower clients who may be evaluating or pursuing debt capital markets (bond financing) as part of their broader financing plan.  At the early stages of our debt advisory engagements, we can provide independent third-party advice to our clients with respect to whether there may be a value additive role for debt capital markets (bonds) in our client's financing transaction. 


In the event that we determine the prognosis for bond financing is positive, then we can further assist the client in determining the most appropriate bond security and term structure, potential targeted bond investor universe, and in which markets and currencies and what form of transaction is most appropriate ("private placements", registered or exempt underwriting, syndication or agency trade).   Many DCS affiliate experts are former investment bankers, lawyers, corporate executives and financial advisors who possess decades of experience in structuring and executing debt capital markets transactions.  We maintain relationships with many of the debt capital markets investment banks and bond counsel law firms operating in many of the markets and sectors that we cover.  In the event that a licensed and registered investment bank may be required to completed the bond transaction, we can assist our client in selecting the most appropriate investment bank and issuers' counsel law firm. 


One of the critical considerations with bond financing is to attain bond ratings from the internationally recognized credit rating agencies (such as Standard & Poor's, Moody's and Fitch Ratings).  In cases where DCS is servicing as our client's capital funding advisor, a debt funding advisor or as an overall transaction advisor, we will otherwise be providing numerous lender and creditor presentations to numerous creditor parties.  Therefore, we are ideally positioned to lead (or participate along with the investment banking team) in the rating agency presentations.  As mentioned above, there are many cases where there may be relevant guarantee and other credit support mechanisms provided by a governmental agencies, multilaterals, monoline guarantors, parent corporations and commercial lenders.  We will assist our client in optimally structuring any such credit enhancements in order to achieve a targeted bond rating that will be suitable for targeted bond investors.


In some cases, in the case of a "private placement" to an identified accredited investor (or group of potential accredited investors), DCS may serve its borrower client directly (without the assistance of an investment bank).  In most cases, whether a the bond transaction is contemplated as a "private placement" or a registered or exempted bond placement, underwriting, agented or syndicated transaction, there will be a value-added role for an investment bank (which we can assist in the selection of), we will assist our borrower client through the entire bond issuance process.   The following outlines the typical "borrower side" process that we provide under a debt capital markets advisory mandate.


Preliminary discussions with potential guarantors, rating agencies and potential bond investors.  DCS experts maintain standing relationships with the major credit rating agencies and many of institutional bond investors in the markets and the major credit rating agencies.  Based on our interactions with bond investors and rating agencies, we can always share our initial views with our clients as to the our view on the interest levels and potential commitment amounts, pricing, terms and conditions that may be expected from these lenders.  We can also quickly access the appropriate departments and representatives within these lender institution, and arrange initial "heads-up" meetings and provide a brief introduction to the financing project and the borrower (if appropriate).  In some cases, it will already be known at this stage that the credit structure will require third party credit support from a highly-rated government agency, multilateral, monoline guarantor, parent corporation and/or commercial lender in order for the bond to be marketable and cost-efficient.  In this case we would typically recommend that these relevant guarantors and/or credit enhancers be approached at the outset in order to understand their willingness and ability to support the transaction, their criteria, terms, conditions and indicative pricing.

Financial modeling.  Amongst the first activities that we will undertake when mandated as the borrower's advisor is begin to develop a financial model (or update and amend a previous model, in the case we may have worked on the client's business or asset in the past).  The "debt case financial model" will evolve through the course of the debt capital raising process.  It will become increasingly refined and may be adjusted ton incorporate certain requirements and comments from credit rating agencies, guarantors and potential bond investors.  Amongst other purposes, the debt case financial model will be utilized to demonstrate to credit rating agencies, guarantors and potential investors that the key pro forma financing metrics of the project or company conform to the lenders guidelines and criteria for leverage, coverage and liquidity ratios.  Another key function of the debt case financial model will be to demonstrate to lenders that under certain pessimistic "down-side" performance scenarios, that the project's or company's cash flows will be sufficient to continue to sufficiently service the entire debt (including other forms of commercial debt, IFI/DFI debt and ECA/Ex-Im debt).  In due course, the debt case financial model will be shared with potential credit rating agencies, guarantors and potential bond investors via the data room and will be an essential tool for discussions and negotiations with these parties (in terms of rating, pricing and terms & conditions).

Assemble and coordinate borrower due diligence An initial and ongoing process will be to assemble all internal and third-party due diligence (contracts and agreements, audits, reports, studies, analyses, databases, etc.)  This data will be necessary for assembly into the Lender Information Memorandum (LIM), discussed below.  However, a great deal of this data will also be necessary for the financial modeling workstream.  In some cases, where there may be due diligence items (such as third-party reports, studies and analyses) that are lacking or insufficient, the borrower can decide whether to pursue these at that time.

Preparation of credit rating agency, guarantor and investors teaser presentations.  We will prepare a brief "teaser" presentation, which contains a very short description of the proposed borrower, guarantors and security (if applicable) and the financing project.  The teaser presentation is based on public, non-confidential information.  We will send the teaser presentation and a list of standard applications materials to the credit rating agencies and guarantors (if applicable).  Typically the teaser presentation will be sent to a list of "Potential Interested Parties" (PIP) for their initial consideration and feedback as to suitability, level of interest and also receive and evaluate their initial concerns and comments.

Develop and maintain "Potential Interested Parties" (PIP Lists).  In conjunction with preparing a teaser presentation, we will develop and maintain a PIP list containing a record of each potential investors' receipt of the teaser, participation in investor/road show presentations, signing of NDA (if applicable), receipt of LIM and virtual data room access and activity in data room etc.  The PIP list can be used to monitor the evolution of PIP lenders' activity and levels of interest.

Road shows and investor presentations.  Road shows and investor presentations, have traditionally been conducted in a physical format.  In the COVID-19 and post-COVID world environment many road shows and lender meetings are conducted virtually.  Physical road shows can be conducted either as group presentations or as individual presentations with key prospective PIP investors at an agreed location.  Typically road shows can be conducted on a regional or global basis.  In other situations it may be possible and desirable for all interested investors to travel to the borrower client's location.  Whether a group meeting or individual meeting format is pursued, it is generally possible for meetings to be arranged in major financial centers where all parties can agree to meet at specific venues.  Aside from considerations such as COVID travel restrictions, the decision as to whether to conduct virtual or in-person, group or individual, client site, regional or global lender road show meetings depends on many factors, including budget and timeframe, types of lenders, size of transaction, level of interest from other key lenders and many other factors.  DCS advisors will assist the client in selecting the best road show / investor presentation approach based on the unique circumstances of the transaction. 

Private Placements: Non-Binding Commitment Letters (or Non-Binding Letter of Interest) (NBCL/NBLoI).  In the case of a "private placement" of the bonds we may next request PIPs who are remain interested in signing an NDA (if applicable) and accessing the LIM and virtual data room to first provide their NBCL/NBLoI) and accompanying indicative, non-binding terms sheets (which we attempt to attain as much detail as possible, but at a minimum contain indicative par amount, currency denomination, final maturity, amortization, rating assumptions, pricing and key required covenants, terms and conditions).  The NBCL/NBLoI's will always be subject to final lender due diligence and credit/investment committee and other internal approvals.  In some cases there may be a rationale to shortlist or down-select PIPs at this level based on their qualifications.  It is not customary to receive and NBCL/NBLoI for bond transactions other than "private placements".

Non-Disclosure Agreements (NDAs)(if applicable).  In some cases, it is essential for each the issuer/borrower, the guarantor and the investor(s), that all material non-public information provided to support investors and creditor due diligence remain confidential.  In such cases, NDAs will be signed by each PIP interested in receiving the Lender Information Memorandum (LIM) and access to the virtual data room.  Under other situations (usually in the cases of public registered bond offerings and government-related transactions) the issuer/borrower may be subject to public disclosure requirements and is prevented from entering into NDAs.  In cases of competitive tenders, there may be multiple buy-side (or "contractor") bidders who wish to access the same potential investors, guarantors and rating agencies.  In this case, where the investor, guarantors and rating agencies each agree to remain non-exclusive, it is common that each of these parties would establish multiple internal "trees" where separate and distinct groups are assigned to various bidders and each would sign separate NDA's (if applicable) with those respective bidder groups.

Lenders Information Memoranda (LIM).  We will prepare the LIM, which provides potential buyers with a highly detailed presentation of the financing plan, key financial metrics, pro forma revenue and debt service coverage projections and related sensitivity analyses, proposed key creditor protections (covenants, security, pledges, guarantees, etc.), risk allocation profiles, company or asset business and market discussions, contractual and corporate structures, management structure, proposed contracts and credit agreements, legal and technical analyses, market studies and demand/revenue forecasts, environmental and social plans and policies, and bankable feasibility studies (as applicable).  Much of this information will generally constitute material non-public information.  Data in the LIM will be supported by information and data contained in the virtual data room.  The LIM and data room will be used by the rating agencies and investors to conduct necessary due diligence.

Virtual Data Room. On behalf of our borrower/issuer clients, we will establish and maintain a secure and encrypted "virtual data room" as a repository for all confidential and non-confidential information that will be accessible and used by the rating agencies, guarantors and potential lenders in effort to complete each's respective due diligence, provide binding offers/commitments and execute bond purchase agreements and related bond documents.

Management meetings and site visits In most cases, the rating agencies, guarantors and potential key bond investors will request one or more physical or virtual meeting(s) with the borrower's and/or guarantor's management and potentially site visits (COVID era travel restrictions has limited this possibility).  Any such meetings would be conducted separately for the ratings agencies, guarantors and investors, respectively.  In the case of investor meetings, these may be group or individual meetings, depending on the size and composition of the PIP investor universe, budget, time frame and the criticality of investors concerns).  These meetings are generally for the purpose of allowing the rating agency, guarantor and PIP investor representatives to ask additional questions of the issuer's management on items that cannot be adequately answered in the LIM and data room (or by DCS as the debt advisor).

Final Negotiations.  After the the "key lead lenders" have completed their due diligence, the DCS/borrower-side advisory team will negotiate all substantive final terms, conditions and pricing in the bond purchase agreement (BPA) and related bond documents.  The BPA and related bond document schedules will specify, at a minimum, the par value, currency denomination, final maturity, amortization, and key required covenants, terms and conditions.

Binding Offers or Commitments.  Based on the agreed material terms of the BPA and related bond documents, the bond investor(s) will be required to bid or provide their binding best and final offers (BAFO) for the bonds, either through placement or an auction process.  


Execution Date.  The date that the BPA and all bond agreements and schedules are dually executed between issuer/borrower, guarantor and the investor(s).

Closing (Dated Date).  The date that all conditions precedent of the borrower and the lender are satisfied and loans and lines can be drawn by and other credit credit facilities become effective.


In some project finance and corporate financing situations, bond financing is also combined with categories of debt financing such cases where the financing structure also involves credit from commercial lendersExport Credit Agencies (ECA's)Export-Import Banks (EX-IMs)Development Finance Institutions (DFIs)International Finance Institutions (IFIs), governmental lenders and providers of providers of hedging instruments (derivatives counterparties).  Having multiple classes of lenders and bondholders in the financing stack can introduce unwieldy intercreditor issues.  DCS advisor have a great deal of experience with multi-class debt structures and in favorably negotiating intercreditor agreements between multiple investor classes.


DCS advisors are able to provide debt capital markets advisory services on a stand-alone basis on behalf of public and private sector clients who are pursuing project financing, acquisition or refinancing/restructuring or workout & restructuring transactions.  In most cases, as debt capital markets advisory services will be only one element of a larger project delivery program, DCS will also be providing other complementary transaction advisory services in relation to other transaction elements.  Our preference is always to provide such comprehensive transaction advisory services and coordinate all elements of the transaction, including debt capital markets advisory services on behalf of our clients.


Under any debt capital markets advisory mandate, DCS will draw from our vast global network of veteran industry expert advisor affiliates and our relationship consultants in order to assemble the most appropriate team to match the specific needs of the transaction at hand.  This will always include leadership of DCS affiliate experts who possess decades of global transactional experience related to the specific sector and transaction type.  In any debt capital markets advisory service mandate, our preferred role is always to serve as the lead project/program manager.  Within this role we are also able to assist in the selection and procurement (or subcontracting) and management of other advisors, including local and international legal, technical, tax, commercial and due diligence advisors or other specialized advisors, as the specific transaction may require.  To the extent that other third-party advisors are required, there are many value added advantages of allowing DCS to assist in the procurement of these advisors.  First, DCS expert affiliates themselves possess many of the legal, technical, commercial and managerial skill sets and we are best positioned to determine which additional outside third-party skill sets are required and which firms or individuals should be hired in these roles.  Secondly, debt capital markets advisory projects are often very complex undertakings, requiring the management and coordination of many simultaneous workstreams.  DCS advisors are experts inproject and program management services and are ideally suited to manage and coordinate a multi-dimensional advisory team most efficiently and effectively.


Complementing our debt capital markets advisory services, DCS advisors offer the following complementary advisory services that may be applicable, dependent on the debt capital markets transaction situation.



DCS experts provide comprehensive debt capital markets advisory services in the following sectors that we specialize in.  Please click on the below links to learn more about the sectors that we cover:







DCS experts provide comprehensive debt capital markets advisory services to the following categories of clients:


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debt capital markets





Daniel Dean

Vienna, Austria





Lloyd Richardson

Washington NC, USA




















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